December is a good time to conduct an internal review of all policies and procedures to ensure that you are compliant with company polices. By doing this in December, you can start the New Year knowing you are compliant. Below are some suggestions of what you should review:
- Review your QC plan and process
- Review your quality control plan and process to assure it contains all the required components. Also, review your QC process to ensure your company is following the plan and that the QC plan is adequate for your business.
- Review the implementation of your Red Flags Policy
- The FTC’s Red Flags Rule went into effect in 2008 but the enforcement date is December 31, 2010. If you have a Red Flag program in place, you are required to review it annually and make any necessary changes.
- Get ready to submit your HMDA
- HMDA annual submission is due March 1. Ensure that your information is correct so there will be no delays in submitting your report on time.
- Review compliance with Graham Leech Bliley Act
- Review your privacy policy and ensure that your employees are complying.
- Review your business continuity plan
- Practice your business continuity plan to make sure it works. Document the practice in detail.
- Review and ensure all licensing is renewed
- Most state company and loan originator licenses expire the end of the month. Ensure that you have all you need to renew your licenses, and that submissions are early enough to overcome any problems.
…And don’t forget to perform your quality control file audits.
Tags: end of year compliance, Mortgage Compliance, mortgage compliance tips, mortgage QC, Mortgage Quality Control, mortgage quality control audit
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?