Comments for Mortgage Compliance Advisors - Your One Stop for Quality Control Services and Resources

Comment on MCA Monthly Compliance Update – March 2011 by Gail Torchia

Gail Torchia — Thu, 26 May 2011 19:31:05 +0000

I have a few compliance questions (we are a correspondent/lender):
1. When redisclosing for a valid CIC- along with the GFE are we required to also include the TIL?
2. If a valid CIC occurs, we redisclose and the APR does NOT increase by 1/8%, are we required to wait before the borrower can sign final loan documents?
3. If I did not disclose a credit to the borrower on my GFE, and at the time I order docs I want to credit the borrower – must I redisclose? AND would I have to wait 3 days before my borrower could sign final loan docs?

Just made aware of your web site…love it! Thank you!

Comment on Fannie Mae is developing appraiser independence requirements that will replace HVCC. by admin

admin — Wed, 25 May 2011 20:49:51 +0000

This is true only if there is no assumption that the borrower will be paying for the appraisal at a later time.

Comment on Fannie Mae is developing appraiser independence requirements that will replace HVCC. by Linda Griffiths

Linda Griffiths — Wed, 25 May 2011 17:54:23 +0000

Is it true that the Broker/Lender can order and pay for an appraisal without a “wait” if they are NOT using borrower’s funds?

Comment on Mortgage Compliance Tips for Wrapping up the Year by Jane Crawford

Jane Crawford — Tue, 24 May 2011 20:57:34 +0000

I have received assistance in the past and appreciated the exceptional customer service. I do have another question regarding “pre-qualification” – HMDA – RESPA. No one has been able to assist me so my final thought is to no longer offer pre-quals.

In a recent HMDA audit it was noted that a loan was coded 5, closed for incompleteness, when the Intent to Proceed was not received, but the loan was approved by the underwriter. We have elected to process and approve or deny applications when Intent to proceed has not been provided. However, this HMDA code “5″ can only be used if a Notice of Incompleteness was provided to the applicant, and it was not in this instance.

Intent to Proceed is RESPA not HMDA so I am confused. We are doing a pre-qualification. We opt to proceed with the processing knowing we cannot charge the consumer for these services if they do not wish to proceed.

So:

We process applications without the intent to proceed. Again RESPA has no bearing on HMDA. If we approved the loan it cannot be incomplete. We communicate the approval to the borrower so, this loan must be coded approved but not accepted.

I know approving before receiving intent is not “normal.” I need to get procedures in place that follow all the Regs, not one over another. So, the offering is a pre-qualification not a pre-approval. Do you have any insight on how to handle this and be compliant with HMDA and RESPA? We want to keep the application process moving knowing we may have to eat the costs incurred. We are in a small community so seldom do we have a consumer walk away. We want to provide the best customer service. We also want to streamline a process and timeline. Perhaps that does not mix well with the regulations?

Comment on Continuing GFE Questions and Answers by admin

admin — Thu, 19 May 2011 14:34:09 +0000

It’s our opinion that you should re-disclose this to the borrower. RESPA does mention this in 3500.7 (f)(5). However, there seems to be different interpretations of if you do or do not need to do this. I would encourage to you read this section of RESPA and make a company decision based off your own interpretations.

Comment on Continuing GFE Questions and Answers by Sherry

Sherry — Tue, 17 May 2011 20:29:20 +0000

If I extend the rate lock but do not charge the borrower, do I have to re-disclose?

Comment on Questions and Answers from “Compliance Q&A Webinar” by admin

admin — Mon, 09 May 2011 21:16:55 +0000

You are correct, and I was wrong in my answer to the question. If a seller pays closing costs, this would lower your APR if these same costs were previously being paid by the borrower. Seller-paid costs should not be calculated in APR, as they are not financing charges.

Comment on Continuing GFE Questions and Answers by admin

admin — Thu, 21 Apr 2011 14:21:24 +0000

The original 10 days that was given to accept the GFE would be the same on all subsequent GFE’s issued.

Comment on Continuing GFE Questions and Answers by Sherry

Sherry — Wed, 20 Apr 2011 22:22:00 +0000

If we redisclose because there has been a rate lock and no settlement charges change do we still change the #2 under important dates? We do put the date 10 days out when doing the initial upfront GFE but do we change that when we redisclose?

Comment on Answers to Questions about New GFE by admin

admin — Tue, 19 Apr 2011 19:41:52 +0000

You would need to send out a GFE three days after application. If loan was locked prior to issuing the GFE, the GFE would need to reflect the accurate lock dates.