Transcript Document

GFE & TIL Disclosures
how to get them right…
© 2012 American Financial Network. All Rights Reserved.
Updated 01/11/2012
RESPA/Completing the GFE
© 2012 American Financial Network. All Rights Reserved.
Updated 01/11/2012
RESPA: 3 Business Days for GFE Issuance
Effective for all loans originated on or after 01/01/2010, the
Good Faith Estimate (GFE) must be issued within three business
days of the loan originator’s receipt of an application or
information sufficient to complete an application.
Sufficient information includes:
•
•
•
•
•
•
Borrower’s Name
Borrower’s Monthly Income
Borrower’s SSN
Property Address
Estimated Property Value
Loan Amount
2
RESPA: GFE-related Disclosures
GFE-related disclosures include:
• Notice of Intent to Proceed,
signed by borrower(s)
• Good Faith Estimate (GFE)
• Initial Fees Worksheet (Point
form)/Itemized Fee Worksheet
(Encompass form)
• Settlement Service Provider
List
These four forms are to be uploaded to the paperless system
as a group under the form definition “GFE (Initial).”
3
RESPA: GFE Preparation and Issuance Rules
GFE preparation and issuance rules include:
• Prior to issuing a GFE, the loan originator/lender may only
collect a bona fide fee for the cost of the credit report.
• Additional fees, such as the appraisal fee, cannot be collected
until the borrower has received a copy of the GFE and TIL.
AFN requires that a signed Notice of Intent to Proceed, signed
TIL, and full set of signed initial disclosures are returned prior
to collecting any additional money.
• Fees may not be listed as POC (paid outside of closing) on the
GFE.
4
RESPA: GFE “Changed Circumstances” Rules
The loan terms or charges can only be changed in the event
there are “changed circumstances” as outlined below:
• Acts of God, war, disaster, or an emergency situation has
arisen.
• Information particular to the borrower or transaction, which
was relied upon when providing the GFE, has since been
found to be inaccurate or has changed; such information may
include the borrower’s credit to qualify, the loan amount, the
estimated property value or any other information that was
used to provide the GFE.
• New information particular to the borrower or transaction,
which was not relied upon when providing the GFE, has been
discovered.
• Other circumstances particular to the borrower or transaction,
such as boundary disputes, the need for flood insurance, or
environmental problems have arisen.
5
RESPA: GFE “Changed Circumstances” Rules
(Cont’d)
"Changed Circumstances" must be disclosed within three
business days of receiving the changed information and only
those fees affected by the changed circumstance may be
amended.
Common Examples of "changed circumstances" (this is not an
all-inclusive list; all must be disclosed within three business days
of the change):
• Underwriter determines a desk review is required
• Borrower requests a change in the loan amount or terms
• Loan is locked and points change based on the locked price
6
RESPA: GFE Disclosure Tolerances
RESPA contains 3 tolerance
levels for costs disclosed on
the GFE. These levels dictate
which disclosed fees can
change at settlement and by
how much (if at all).
Those with Zero Tolerance
cannot change at closing.
Those with a 10% Tolerance
can increase up to 10% at
closing.
Those with Unlimited Tolerance can increase by any
percentage or amount at
closing.
7
RESPA: GFE Re-disclosure Requirements
Each time the GFE is amended,
the following forms are required
with this re-disclosure:
•
•
•
Changed Circumstance Form,
identifying the change(s) that are
being made
Revised GFE with new disclosure
date and charges; list each fee that
is changing per the changed
circumstance form, making sure to
show the old amounts and the new
amounts of the fees
Re-disclosed Initial Fees Worksheet
(Point form)/Re-disclosed Itemized
Fee Worksheet (Encompass form)
These three forms are to be
uploaded to the paperless system
as a group under the form
definition “GFE (Re-disclosure)
#1” (#2, #3, etc.).
8
RESPA: Right to Cure and Tolerance Violations
If any charges at settlement are greater than those listed on the
GFE by more than the permitted tolerance, the branch may
“cure” the tolerance violation by issuing a lender credit to
reimburse the borrower.
The reimbursement must equal the amount by which the
tolerance was exceeded.
9
Notice of Intent to Proceed
• The
initial
disclosure
date in this example is
01/04
01/04/2011.
• This form has two fields
in which a date must
appear; the 1st is the
date this form is issued,
and the 2nd is the date
01/04
of the GFE (they will
typically match).
10
GFE Page 1: Originator, Borrower & Property
Page 1 of the GFE contains basic loan information, including the loan originator,
borrower(s) and loan terms. You must also provide the loan originator’s name,
address, phone number and email address and his/her business name. Use
AFN phone number or cell phone numbers, and AFN or personal e-mail
accounts.
Names of all applicants are also required, as well as the subject property
address.
The GFE must also be dated with the completion date.
11
GFE Page 1: Important Dates – Floating Loans
“Important Dates” for floating loans are to be completed as follows:
Line 1. The date (and time, if applicable) until which the stated interest rate is
available (typically the initial disclosure date; N/A is not acceptable)
Line 2. The date until which the estimate for all other settlement charges is
available; it must be at least 10 business days from the date of the GFE (N/A is not
acceptable). Count starting the first business day after the GFE is disclosed; the
GFE expires at midnight on the 10th business day. Saturdays, Sundays and legal
holidays do not count as business days.
Line 3. The rate lock period, in calendar days (if not applicable, enter “N/A”)
Line 4. The minimum number of days before settlement the rate must be locked
(AFN policy is 7 days)
NOTE:
Complete either Line 3 or Line 4 for locked loans. If the rate is floating, enter N/A on
Line 3 and complete Line 4. If the rate is locked, complete Line 3 and enter N/A on Line 4.
12
GFE Page 1: Important Dates – Locked Loans
You must re-disclose when the loan locks and issue a new GFE (within 3 days),
changing information on Page 1.
“Important Dates” for locked loans are to be completed as follows:
Line 1. The date (and time, if applicable) the rate lock will expire
Line 2. This should remain at 10 business days from the date of the initial GFE
(N/A is not acceptable; date does not change with re-disclosure)
Line 3. The rate lock period, in calendar days
Line 4. Enter N/A if the loan is locked
NOTE: Complete either Line 3 or Line 4 for locked loans. If the rate is floating, enter N/A on
Line 3 and complete Line 4. If the rate is locked, complete Line 3 and enter N/A on Line 4.
13
GFE Page 1: Summary of Your Loan
Your initial loan amount is – The total loan amount
Your loan term is – The term of the loan, expressed in years
Your initial interest rate is – The note rate, or initial rate if an ARM
Your initial monthly amount owed for principal, interest, and any
mortgage insurance is – This amount should reflect principal, interest,
and any mortgage insurance payments.
14
GFE Page 1: Summary of Your Loan (Continued)
Check No or Yes to indicate whether the interest rate could rise. If yes,
indicate the maximum rate to which it can rise over the life of the loan
and the first rate change date (if date unknown, enter “unknown”).
Check No or Yes to indicate whether the loan balance can rise, even if the
borrower makes payments as agreed and on time. A loan with a negative
amortization is an example of a “Yes.” If yes, indicate the maximum
amount to which the balance can rise during the life of the loan.
NOTE: If the loan balance will increase only because escrow items are
being paid through the loan balance, you do not have to check Yes.
15
GFE Page 1: Summary of Your Loan (Continued)
Check No or Yes to indicate whether the monthly amount of principal, interest,
and mortgage insurance can rise, even if payments are made as agreed and
on time. If yes, state: the # of years (or months) until the monthly amount
can first change; the maximum monthly amount at the first change; and the
most the monthly payment amount could ever be over the life of the loan.
Check No or Yes to indicate whether a prepayment penalty applies.
indicate the maximum amount it could be.
If yes,
Check No or Yes to indicate whether there is a balloon payment. If yes, state
the amount of the payment and the number of years until it’s due.
16
GFE Page 1: Escrow Account Information
This box is used to inform the borrower(s) whether or not the loan
includes an escrow account for property taxes and other of their financial
obligations.
The “monthly amount owed of…” should match the amount you entered as
the initial monthly payment amount in the “Summary of your loan”
section. It includes principal, interest, and mortgage insurance only (and
does not include the amount of the estimated escrow payment).
Check No or Yes to indicate whether or not there is an escrow account. If
yes, you are required to provide further details on page two.
17
GFE Page 1: Summary of Settlement Charges
Block A – This is the amount carried forward (actually, backward) from
origination charges/fees calculated on page 2.
Block B – This is the amount carried forward (actually, backward) from
all other charges/fees for settlement services calculated on page 2.
Block A + B – This is the total sum of the amounts shown in the two
blocks above.
18
GFE Page 2: Estimated Settlement Charges –
Origination Charge
Block 1 – The total of all charges that all originators (lenders, mortgage
brokers) involved in the transaction will receive. This includes all fees
associated with getting the loan, such as: the broker’s YSP; origination
points; application, processing, underwriting, administration, document
preparation, wire, lender inspection, and other miscellaneous fees (does
not include discount points used to buy down the rate). An originator
cannot separately charge additional fees.
EXAMPLE:
If there is a 1% origination fee on a $250,000 loan, plus a $250
underwriting fee, and a $100 wire fee, the amount listed here would be
$2,850 (1% of $250,000 = $2,500 + $250 + $100 = $2,850).
19
GFE Page 2: Estimated Settlement Charges –
Origination Charge (Continued)
Block 2 – Check only one of the three checkboxes, insert the interest
rate, and insert the dollar amount (or zero if none) in the box on the
right.
How this box is completed depends on whether or not the
transaction involves a mortgage broker.
No Mortgage Broker Involved – You may choose not to disclose any
credit or charge for the interest rate separately from the origination
charge by checking the 1st box and inserting a zero in the box on the
right. AFN requires that lender credits are disclosed here, as well as any
points charged to the borrower.
20
GFE Page 2: Estimated Settlement Charges –
Origination Charge with Broker Involvement
Remember, how this box is completed depends on whether or not the transaction
involves a mortgage broker.
Mortgage Broker Involved – Check the 2nd or 3rd box to disclose whether there
are discount points that reduce the rate (a charge) or a YSP (a credit) for the
specific interest rate. This amount is the net payment from the lender to the
mortgage broker. Calculate the sum of all payments from the lender to the broker,
including payments based on the loan amount, a flat rate, or any other computation.
21
GFE Page 2: Estimated Settlement Charges –
Origination with Broker Involved YSP
X
500.00
5.00
-500.00
YSP Example – If the net payment from the lender to the mortgage broker is
positive (i.e. a YSP is paid to the broker), check the 2nd box to reflect a credit to the
borrower. State the amount of the YSP in the box provided and insert this as a
negative amount (a credit) in the box on the right. This negative amount offsets the
amount of YSP paid to the broker as compensation, which was included in Block 1
under “Our origination charge.”
NOTE: Check only one box in Block 2; there cannot be both a credit for a YSP and a
charge for discount points in the same transaction.
22
GFE Page 2: Estimated Settlement Charges –
Origination with Broker Involved Points
X
500.00
5.00
500.00
Points Example – If the net payment from the lender to the mortgage broker is
negative (i.e. the borrower paid discount points to buy down the rate), check the 3rd
box to reflect a charge to the borrower. State the dollar amount of the charge and
insert it as a positive amount (a charge) in the box to the right.
If there is no net payment (the sum calculated equals zero), either the 2nd or 3rd box
may be checked. A zero must be entered in the box to the right.
NOTE: Check only one box in Block 2; there cannot be both a credit for a YSP and a
charge for discount points in the same transaction.
23
GFE Page 2: Estimated Settlement Charges –
Total Origination Charges
Block A – This is the total of the amounts shown in Block 1 and Block 2.
Transfer this amount to Block A on Page 1 of the GFE.
NOTE: A negative sum is possible in some transactions.
Where a “no cost” loan encompasses the loan origination fee and other
third-party fees, list a negative amount (a credit) in Block 2 to offset all of
the fees in the “no cost” loan. This will result in a negative number in
Block A to cover the intended third-party fees listed in Blocks 3-11.
24
GFE Page 2: Charges for Settlement Services –
Lender-selected Required Services
Block 3 – List third-party service providers that are required and selected
by the originator (other than title services), including the specific service
provided and estimated charge for each. Enter the sum of these charges
in the box to the right.
Third-party settlement providers are providers of services other than the loan
originator itself. Examples include credit vendors, appraisers, flood and tax-related
service providers, and mortgage insurance companies.
25
GFE Page 2: Charges for Settlement Services –
Title Services, Lender’s and Owner’s Title Ins
Block 4 – Enter the estimated total charge for these third-party
settlement services in the box to the right, regardless of who selects of
pays for them. This may include fees for title searches, examinations and
endorsements, delivery, lender’s title insurance premiums, notary and
settlement fees.
Block 5 – For purchase transactions, enter an estimate of the charge for
owner’s title insurance and endorsements in the box to the right,
regardless of who selects and pays for them.
For non-purchase (i.e. refinance or home equity loan) transactions, enter
“Not Applicable” or “N/A” in the box to the right.
26
GFE Page 2: Charges for Settlement Services –
Required Services for which Borrowers Can Shop
Block 6 – List each required third-party service for which the borrowers
are permitted to shop/select the settlement service provider (other than
title services). Describe the service and insert a fee estimate in the
charge column.
Enter the sum total of these fees in the box to the right.
NOTE: If the borrowers are permitted to shop for third-party settlement
services, they must be given a separate “Written List of Settlement
Service Providers” at the time of the GFE.
27
GFE Page 2: Charges for Settlement Services –
Government Recording Charges, Transfer Fees
Block 7 – Enter an estimate of the state and local government recording
fees for loan and title documents in the box to the right.
Block 8 – Enter an estimate of all state and local government fees
attached to mortgage loans and home sales that are likely to be charged
at settlement (based on the proposed loan amount or sales price and the
property address) in the box to the right.
28
GFE Page 2: Charges for Settlement Services –
Initial Escrow Account Deposit
Block 9
In the gray shaded box:
Check the appropriate box(es) to indicate whether the account will cover
future payments for all property taxes, all insurance as they come due.
In the box to the right:
Enter an estimate of the amount the borrower will be required to place
into a reserve/escrow account at closing for recurring charges. These
may include: property taxes, hazard insurance, flood insurance, mortgage
insurance, other periodic charges.
29
GFE Page 2: Charges for Settlement Services –
Daily Interest Charges
Block 10
In the gray shaded box:
Calculate the amount of a single day’s interest, and enter this figure in
the money field in the gray shaded box.
Next, enter the number of odd days (from the date of settlement until the
first day of the first period covered by scheduled mortgage payments).
Indicate the projected closing date.
In the box to the right:
Multiply the daily interest by the number of odd days and enter the
product here.
30
GFE Page 2: Charges for Settlement Services –
Homeowner’s Insurance
Block 11
List the hazard and other similar insurance types (i.e. fire, flood, etc.) the
borrower is required to purchase at or before closing, along with an
estimated charge for each.
Enter the sum total of these fees in the box to the right.
31
GFE Page 2: Charges for Settlement Services –
Total Settlement Charges
Block B – Enter the sum total of all amounts listed in Blocks 3-11.
Block A + B – Enter the sum total of the amount in Block A plus the
amount in Block B.
Remember to also transfer these amounts to the corresponding Blocks on
Page 1.
32
GFE Page 3: Charges that Can Change at
Settlement
This section offers information to the borrower regarding disclosed
estimates of fees on the GFE that cannot increase, fees that can
increase up to 10%, and other charges that can change at
settlement.
33
GFE Page 3: Using the Tradeoff Table
Completion of this section is optional. If you choose to complete it,
enter data from the current GFE in the first column, and the options as
captioned in the headers of the other two columns.
The alternative loans must use the same loan amount and be identical to
the loan on the GFE except for the differences expressed in the column
headings.
34
GFE Page 3: Using the Shopping Cart
This is a tool provided for the borrower to record and compare loan offers. It
is to be left blank by the originator and the borrower may complete it if he or
she wishes.
Below the table is a statement to the borrower that the loan, its fees and
settlement charges will not change if the lender sells the loan.
35
Itemized Fee Worksheet (Initial)
• The date prepared must
match the date prepared on
the initial GFE
• The total origination charges
must
match
the
total
origination charges on page
1 of the GFE
36
Settlement Services List of Providers
• The list of providers must
contain settlement providers
whose fees were disclosed
on the loan.
• Be sure the settlement
providers’ names are listed
on the form.
• If the borrower chooses
another settlement provider
at closing, the tolerance is
unlimited.
37
Re-disclosing the GFE
© 2012 American Financial Network. All Rights Reserved.
Updated 01/11/2012
Changed Circumstances Form (Re-disclosing)
• The re-disclosure date in this
example is 01/14/2011.
• Always
enter
the
GFE
Revision #.
• Indicate the change for
which the GFE is being redisclosed.
• Indicate if any charges are
being revised as a result of
the change.
39
Good Faith Estimate (Re-disclosing) – Pg 1
• The re-disclosure date in this
example is 01/14/2011.
• Box 1: If re-disclosing due
to a rate lock, enter the lock
expiration date here.
• Box 2: IMPORTANT! Box 2
under “Important Dates”
should have the same date
the initial GFE had in its Box
2 (10 business days from
the initial disclosure date).
• Box 3: If re-disclosing due
to a rate lock, enter the
number of days locked here.
• Box 4: If re-disclosing due
to a rate lock, enter N/A.
40
Good Faith Estimate (Re-disclosing) – Pg 2
• Origination charges cannot
change from the initial GFE
unless from an allowable
changed circumstance.
• The origination fee cannot
change when the loan is
locked.
• Discount points may be
changed/added if the loan is
locked at a cost to the
borrower.
41
Itemized Fee Worksheet (Re-disclosing)
• The date prepared must
match the date prepared on
the re-disclosed GFE.
• The origination charges must
match origination charges on
page 1 of the re-disclosed
GFE.
42
TILA/MDIA Compliance
© 2012 American Financial Network. All Rights Reserved.
Updated 01/11/2012
MDIA: Summary
MDIA requires, among other things, that a creditor provide the
early disclosures even when the loan is not for the purpose of
financing the purchase or initial construction of the consumer’s
principal dwelling. The early disclosures must also be provided
for non-purchase closed-end loans secured by the consumer’s
principal dwelling (such as a refinance loan). MDIA also requires
these disclosures to be given before the consumer pays any fee,
other than a bona fide and reasonable fee for obtaining the
consumer’s credit history.
The creditor must also supply the upfront disclosures, including
the Truth in Lending (TIL) and any revisions prior to closing if
fees change above tolerance.
44
MDIA: RESPA Requirements
The final rule applies to all RESPA covered loans secured by the
dwelling of a consumer. This includes the following:
• Purchase, refinance and home equity loans on principle
residences
• Purchase, refinance and home equity loans on secondary
residences
• Investment/Rental properties (could be considered exempt,
but AFN will treat these in the same manner as it does owneroccupied loans)
45
MDIA: Initial Disclosures
Preparation of Initial Disclosures
Loan originators or loan processors are required to prepare the initial
disclosures. Refer to the AFN Disclosure Checklist for an up-to-date list of
disclosures required for each loan type. Refer to the list of APR versus NonAPR fees for accurate preparation of disclosures.
Timing of Initial Disclosures
Initial disclosures must be sent out within three business days of receipt of
the initial loan application. This rule does not apply to FHA/VA specific forms,
which must still be signed and dated the same day the borrower signs/dates
the loan application.
No fees, except a bona fide and reasonable credit fee, may be charged until
the borrower receives the initial TIL disclosure. AFN considers the disclosures
received by the borrower when they are signed by the borrower(s).
Any additional fees, including the appraisal fee, cannot be collected until the
borrower has received and signed initial disclosures. Additional fees can be
charged the same day the disclosures are returned signed by the borrower(s).
46
MDIA: Application Defined
For purposes of MDIA, AFN will use the definition of application
provided under Regulation Z as revised by HUD. Application
means the submission of a borrower’s financial information in
anticipation of a credit decision relating to a federally related
mortgage loan. It shall include the following:
•
•
•
•
•
•
•
Borrower’s Name
Borrower’s Income
Borrower’s SSN to obtain credit
Property Address
Estimated Property Value
Loan Amount
Any additional information deemed necessary
An application may either be in writing or electronically
submitted, including a written record or an oral application.
Disclosures are required when all items are received.
47
MDIA: Verbiage Requirements
The following verbiage must be added to the disclosures:
“You are not required to complete this agreement merely
because you have received these disclosures or signed a loan
application.”
The following rules also apply:
•
•
•
•
AFN Corporate uses the latest Point and Encompass versions, which
include the new verbiage on the disclosures. Branches must ensure
their software/disclosures are current and have the updated verbiage.
The required verbiage must be noticeably added.
All numeric disclosures are still marked “E” for estimate.
This verbiage must also be included in any subsequent disclosures.
48
MDIA: Waiting Periods/When to Re-disclose
Seven-day Waiting Period After Disclosure
Once the initial estimated disclosures are provided, there is a seven business
day waiting period before borrowers sign loan documents.
The initial seven business day waiting period begins when the borrower
receives the initial disclosures. AFN will consider the disclosures received
when they are signed by the borrower(s).
The business day definition for the purpose of the waiting periods is similar to
the definition used for rescission: Monday – Saturday excluding legal federal
holidays. The only difference is: with rescission, when you’re counting days,
you may fund the day after the last day in the count; with MDIA, when you’re
counting days, you may draw docs on the last day of the count.
When to Re-disclose
If the APR, as defined by RESPA, increases by more than 1/8th of 1% (0.125)
from the previously disclosed APR, you must re-disclose.
49
MDIA: Waiting Periods/When to Re-disclose
(Cont’d)
Three-day Waiting Period After Re-Disclosure
Any re-disclosure requires an additional three business day waiting period
prior to consummation (date the borrowers sign loan documents).
The business day definition for the purpose of the waiting periods is similar to
the definition used for rescission: Monday – Saturday excluding legal federal
holidays. The only difference is: with rescission, when you’re counting days,
you may fund the day after the last day in the count; with MDIA, when you’re
counting days, you may draw docs on the last day of the count.
If revised disclosures are mailed, the three business day waiting period will
begin after allowing three business days for mail to be delivered, thus loan
documents cannot be prepared or signed until six business days have passed.
If revised disclosures are delivered in person, faxed or e-mailed and returned
signed and dated by all borrowers, the three business day waiting period may
begin based on the date the revised forms are signed/dated.
50
MDIA: Initial Disclosure – Day Counting Chart
* Date borrowers sign/date initial disclosures
*** Applies to scenarios where Saturday is counted as a business day, and there is no
legal holiday from the date the initial disclosure was received.
51
MDIA: Re-disclosure – Day Counting Chart
* Applies to scenarios where Saturday is counted as a business day, and there is no legal
holiday from the date the initial disclosure was received.
52
MDIA: Avoid Unnecessary Delays with Loan Docs
Following are things you can do to help avoid unnecessary delays with
the issuance of loan documents:
•
•
•
•
•
•
•
•
Obtain accurate fees for escrow and title before issuing initial disclosures
Do not over- or underestimate fees (including daily interest) on initial
disclosures
Record APR and Non-APR fees correctly when issuing initial disclosures
(see chart)
Do not collect appraisal fees until signed initial disclosures are received
Obtain an updated estimated closing statement from escrow at the time of
loan approval; if a re-disclosure is required, prepare it at that time
Review the APR when the loan is locked or when you know the rate will
change; if re-disclosure is required, prepare it at that time
Use the correct upfront MI Premium or monthly MI Premium (see chart)
Complete Point/Encompass correctly to calculate the monthly MI (see
example)
53
MDIA: Calculating the Monthly MI
You must go beyond the
primary
MI
fields
to
properly calculate MI payments. In this Encompass
example, click the pencil
icon next to the MI fields to
reveal another box in
which you must enter data.
On the 2nd screen, enter
“Cancel at 78%” (LTV) and
also check the box for
“Calculate
based
on
remaining balance.”
MI will not be correct if it is
calculated as base loan
amount multiplied by the
MI factor and divided by
12.
54
Completing the TIL
© 2012 American Financial Network. All Rights Reserved.
Updated 01/11/2012
TIL Disclosure Statement – Top of the Form
The top of the TIL lists:
•
Applicant Name(s)
•
Property Address
•
Application Number
•
Preparer
•
Date prepared
•
APR
•
Finance Charge
•
Amount Financed
•
Total of Payments
•
Payment Schedule
The last five items are
calculations completed
by Point or Encompass
based on loan data
entered.
56
TIL Disclosure Statement – Middle of the Form
This section of the form identifies the lender’s insurance requirements.
Under the INSURANCE section, always indicate that Hazard insurance
is required, and add Flood Insurance if it is required.
57
TIL Disclosure Statement – Bottom of the Form
Completion of this section will vary, depending on whether the loan:
• Is a purchase or refinance
• Is FHA, VA or Conventional
• Has a Prepayment Penalty
58
TIL Disclosure Statement – Bottom (Continued)
1
2
3
4
5
1
Under the SECURITY
section,
mark
“The
goods
or
property
being purchased” for a
purchase loan, or “Real
property you already
own” for a refinance.
2
Under FILING FEES,
this amount should
match the recording
fees shown on the
GFE/GFE Itemization.
6
3
Under LATE CHARGE, enter “15” for the number of days late, and “4%” for the
penalty percentage if it is a FHA or VA loan, and “5%” if it is a conventional loan.
4
Under PREPAYMENT, regardless of loan type (Conv, FHA, VA) mark “will not have to
pay a penalty;” Conv, VA “will not be entitled to a refund of part of the finance
charge;” and FHA “may be entitled to a refund of part of the finance charge.”
5
Under ASSUMPTION, mark “may, subject to conditions” for FHA/VA loans, and mark
“may not” for conventional loans.
6
For all loan types, mark the “E means an estimate” and “all dates and numerical
disclosures except the late payment disclosure are estimates” boxes.
59
TIL – Itemization of Amount Financed
• The date prepared must
match the date prepared on
the initial TIL.
• The origination charges must
match origination charges on
page 1 of the GFE.
• Both the TIL and the Itemization of Amount Financed
are to be uploaded to the
paperless system as a group
under the form definition
“TIL (Initial).”
60
TIL Disclosure Statement (Re-disclosing)
• Re-disclosure is required if
the APR increases by more
than .125%.
• You only need to re-disclose
the TIL when you re-disclose
the GFE if the APR increases
by more than .125%.
• The date prepared is the
date you re-disclose.
• There is a waiting period
before docs can be drawn of
6 days if the re-disclosed TIL
is not signed and 3 days if it
is signed.
61
Itemization of Amount Financed (Re-disclosing)
• The date prepared must
match the date prepared on
the re-disclosed TIL.
• Both the re-disclosed TIL
and the re-disclosed Itemization of Amount Financed
are to be uploaded to the
paperless system as a group
under the form definition
“TIL (Re-disclosed) #1” (#2,
or #3).
62
TIL Disclosure Statement – New Format
• For all applications taken
01/30/2011 and after, the
newly revised TIL Disclosure
Statement is required.
• The new version of the TIL
displays an “Interest Rate
and
Payment
Summary”
where the former form had a
payment schedule table.
• Be sure you have updated
your Encompass or Point
version
to
include
this
revised TIL Disclosure.
63
Disclosures
© 2012 American Financial Network. All Rights Reserved.
Updated 01/11/2012
Disclosure Tips
• Disclosure
checklists
are
available on WebTrac.
• Use print groups prepared
by the corporate office for
accuracy.
• Use of incorrect information
will delay file progress.
65
Equal Credit Opportunity Act (ECOA) Notice
The ECOA Notice must have the
address of the FTC in the
middle section:
Federal Trade Commission
Equal Credit Opportunity
600 Pennsylvania Avenue
Washington, DC 20580
- OR Federal Trade Commission
CRC-240
Washington, DC 20580
66
Servicing Disclosure Statement
• The initial disclosure date in
this example is 01/04/2011.
• Under Servicing Transfer
Information, the checkbox
for “We do not service
mortgage loans of the type
for which you applied. We
intend to assign, sell, or
transfer the servicing of your
mortgage loan before the
first payment is due” must
be marked.
67
CA Fair Lending Notice
• The initial disclosure date in
this example is 01/04/2011.
• The addresses and phone
numbers for the Dept of Real
Estate (DRE) and the Dept
of Corporations (DOC) must
appear in the space above
the Acknowledgement.
Department of Real Estate
320 W. 4th St., Ste 350
Los Angeles, CA 90013-1105
(213) 620-2072
Department of Corporations
320 W. 4th St., Ste 750
Los Angeles, CA 90013-2344
(866) 275-2677
68
FHA Identity of Interest Certification
• One of the options must be
checked.
• If the borrower has a
relationship with the seller,
the LTV will be limited.
69
CA Domestic Partnership Addendum
• If the top 2 boxes are both
marked, there is no action to
be taken based on this form.
• If box 3 or 4 is marked, it
will be treated as community
property; we must require a
grant deed from the domestic partner before we close
the transaction.
• If box 1 is marked and box 2
is not marked, get clarification before proceeding to
docs (this may also require a
grant deed from a domestic
partner).
70
Thank you for attending.
Any questions?
© 2012 American Financial Network. All Rights Reserved.
Updated 01/11/2012