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The Biggert-Waters Act provides for coverage on multi-family dwellings in the amount of $500,000 per building, not $500,000 per unit. that is the maximum amount available from FEMA. A private policy is not subject to the Same limit. You may accept a private policy in lieu of a FEMA policy if the coverage is comparable to a FEMA policy.
To determine the amount of coverage required you must consider the amount of the loan, the maximum amount available, and the value of the improvements.
The new Truth in Lending rules require a credit report for anyone becoming a loan originator on or after the January 2014 effective date of the rule.
You don’t have a privacy concern because you are not releasing information, you are receiving the information. Generally the 4506T comes directly or indirectly from the IRS. The privacy rules that cover your bank do not apply to a federal agency.
When an escrow is in place you should have an escrow agreement with the borrower that outlines the rights and responsibilities of both parties. It would be appropriate for the escrow to explain when and the escrow can be cancelled.
If you currently are not using an escrow agreement, contact your loan origination software provider to see if one is available thought the LOS.
All of these issues were addressed in a recent Compliance Masters Group session, at the request of members. Unless you are a new member that information is available in the recording of the meeting and in the documents we provided.
In the coming months we are developing products that summarize he material covered in prior meetings. They will be available in the cart on the website.
If a fee listed on the GFE is not imposed you do not enter in either the GFE or HUD-1 column of the comparison chart. If you include it in the GFE column, but not in the HUD-1 column you are artificially inflating the tolerance for 10% tolerance group.
The new escrow rules are effective on June 1, 2013. If you bank meets all of the conditions in Section 1026.35(b)(2)(iii) then you may stop escrowing. The fact that you have escrowed on a first-lien HPML does not preclude you from taki advantage of the new exemption.
There is no specified time period for sending the notice in that situation. When you are aware that maps have changed and now flood insurance is required when previously it was not, you must provide the borrower with a 45-day notice and require insurance. If not obtained in the 45-day period you must force place insurance. Some argue that the FHN is not required in this situation, but we advise providing the notice.
Jacob,
The concern is that having the monitoring information available is equivalent to collecting monitoring information. You are required to collect monitoring information for certain loans, but the practice is prohibited for other loans.
For CIP purposes you must verify your customer’s identity. You may do that by checking a driver’s license, among other methods. You must record the method of verifying the identity, but you are not required to keep a copy of the driver license. Keeping a copy raises the spector of a fair lending violation.
Most examiners will not cite a violation when the license is retained for CIP purposes. If you decide to keep the license, you are less likely to be challenged by an examiner if the copy is retained somewhere other than the loan file.
Ship mortgages generally involve the Coast Guard. You might try their website or contact the attorney that assists with your secured transactions. The Coast Guard site is https://www.uscg.mil/
A servicer can be a small servicer if it owns mortgage servicing rights for mortgage loans that are either owned by the servicer or an affiliate, or for which the servicer or an affiliate was the entity to whom the obligation was initially payable.
Generally, fees paid to a title company that is an affiliate will be included in the total of points and fees. There are several elements to the definition of an “affiliate,” but generally a company must owns 25% or more of a company for it to be an affiliate.
I did a quick review of legislation passed during the current session of the KY legislature, but did not find any legislation dealing with this topic. Even if there were legislation passed during a session, such legislation generally has a 60 – 90 day delayed effective date.
I also did a quick review of FHA guidelines and did not find any recent changes regarding water testing or related matters. Could you check with the mortgage company to get more information to share with us here?
Under the present rules, and under the revised rules that are effective June 1, 2013, both first lien and subordinate lien transactions may be HPMLs, but the escrow rules only apply to first lien HPMLs secured by the consumer’s principal dwelling. A first lien transaction is a HPML if the the APR exceeds the APOR by 1.5 or more percentage points.
