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You will still look to 1026.20(a) to determine if you have a refinance. If so that is considered a new transaction requiring new disclosures within the time frames outlined in 1026.19.
Here are a couple of recent question on determining a refinance:
You need to look to the requirements laid out in flood rules. If you meet those then you qualify for flood escrow exception.
Small lender exception. (1) Qualification. Except as may be required under applicable State law, paragraphs (a), (b), and (d) of this section do not apply to a bank:
(i) That has total assets of less than $1 billion as of December 31 of either of the two prior calendar years; and
(ii) On or before July 6, 2012:
(A) Was not required under Federal or State law to deposit taxes, insurance premiums, fees, or any other charges in an escrow account for the entire term of any loan secured by residential improved real estate or a mobile home; and
(B) Did not have a policy of consistently and uniformly requiring the deposit of taxes, insurance premiums, fees, or any other charges in an escrow account for any loans secured by residential improved real estate or a mobile home.There is a discussion of the small lender exception beginning on p. 43 of the preamble.https://www.federalreserve.gov/newsevents/press/bcreg/bcreg20150622a1.pdf
I’m with you. After looking at 38(t)(5)(v)-(vi) I don’t see where the seller information can be omitted even if the CDs are separated, so I would agree that it does need to be included unless they can prove otherwise. If you can get in contact with a rep ask them what they are basing that opinion on. There may be something buried in the preamble (althought I did search and could’t find anything that supports that) or they may have gotten an unofficial opinion from the CFPB.
I don’t recall anything in the TRID rules that says you can’t have a “change in terms/modification” of a loan. You’re still going to look to 1026.20(a) to determine if you have a refinance.
Here is a post on determining “refinance” as purpose: https://mycomplianceresource.com/forums/topic/trid-refinance-or-home-equity/
Reg B 1002.7(d)(1)-3 says: “A person’s intent to be a joint applicant must be evidenced at the time of application. Signatures on a promissory note may not be used to show intent to apply for joint credit. On the other hand, signatures or initials on a credit application affirming applicants’ intent to apply for joint credit may be used to establish intent to apply for joint credit. (See Appendix B.) The method used to establish intent must be distinct from the means used by individuals to affirm the accuracy of information. For example, signatures on a joint financial statement affirming the veracity of information are not sufficient to establish intent to apply for joint credit.”
Applicant is defined as any person who requests or who has received an extension of credit from a creditor, and includes any person who is or may become contractually liable regarding an extension of credit. For purposes of §1002.7(d), the term includes guarantors, sureties, endorsers, and similar parties.
Person means a natural person, corporation, government or governmental subdivision or agency, trust, estate, partnership, cooperative, or association.
It sounds like in your situation you have two “persons” that are “applicants” applying jointly so you would need that intent to apply jointly.
There are other situations that are a little tricky. For example, if you have a business and the bank requires an officer to be a guarantor after the application is received that is not a joint application and you wouldn’t need to document joint intent. However, if a guarantor decides to apply as guarantor at the time of application by the borrower then that would be considered joint intent.
Just remember to look to the requirement in 1002.7(d) and then to the definitions of applicant and person and that should help.
This specific situation isn’t addressed in the reg, commentary or preamble, but we believe you need to disclose a loan officer on the initial LE. If that loan officer has changed at the time the rate is locked then that information would change on the revised Loan Estimate.
Just from the information you’ve provided I am leaning toward refinancing as the purpose. But you should look to the discussion on what constitutes a refinancing under 1026.20, and keep in mind that it doesn’t have to be the same creditor for purposes of 1026.37. (See commentary below.)
Comment 37(a)(9)(2):Refinance coverage. The disclosure requirements under § 1026.37(a)(9)(ii) apply to credit transactions that meet the definition of a refinancing under § 1026.20(a) but without regard to whether they are made by a creditor, holder, or servicer of the existing obligation. Section 1026.20(a) applies only to refinancings undertaken by the original creditor or a holder or servicer of the original debt. See comment 20(a)-5.
Because of this discussion (see below) in the premable on p. 676 I believe it would be a refinance (assuming it meets that definition).
A GSE requested that the Bureau clarify that in order for a loan to be considered a
purchase loan, none of the borrowers can currently hold an ownership interest in the property. The commenter noted that such a clarification would align the meaning of purchase for the disclosure required by § 1026.37(a)(9) with current industry standards. The Bureau believes that the general understanding of a “purchase” loan is one where the consumer does not already hold an interest in the property. Further, the Bureau believes that the proposed regulatory text is sufficient to convey such meaning, because it states that the disclosure applies to the “acquisition” of the property, and one cannot acquire what one already owns. Accordingly, the Bureau is adopting § 1026.37(a)(9)(i) as proposed and comment 38(a)(9)-1.i substantially as proposed with minor modifications for clarity.From the preamble p. 139:
The final rule also does not include a separate definition of application for pre-approval estimates or worksheets. Creditors are currently able to issue such documents at any time before issuing the RESPA GFE and the early TILA disclosure, and will continue to be able to do so under this final rule. Further, the Bureau believes that creating another definition of application would create consumer confusion and add to regulatory burden.I agree. Assuming the fee isn’t paid to an affiliate, the bank is passing the fee along, and you have permitted the borrower to shop the fee would be subject to the 10% tolerance.
belandis – I’m not sure I understand your last question. Can you give me a scenario or more details?
Comment 1026.37(f)(2)-4:
Section 1026.37(f)(2) and (3) requires disclosure of the amount the consumer will pay for the lender’s title insurance policy. However, an owner’s title insurance policy that covers the consumer and is not required to be purchased by the creditor is only disclosed pursuant to § 1026.37(g).Even though the title company then pays another unaffiliated provider for certain services it must still be considered paid to an affiliate since that is who the payment is going to. Here is information from the preamble.
From the preamble to the final rule:
p. 345:
Lastly, the Bureau received requests from some title company
commenters that sought an exemption from the proposed general rule with respect to the
treatment of payments that affiliated title companies receive at closing that are disbursed to service providers not affiliated with the lender as payment for services performed by the unaffiliated service providers on behalf of the affiliated title companies.p. 350
The Bureau also declines to modify the rule to provide an exemption for payments that affiliated title companies receive at closing that are then disbursed to unaffiliated service providers as payment for services performed by the unaffiliated service providers on behalf of the affiliated title companies. If a lender requires a consumer to use an affiliated company for title services, then the fees the consumer pays to the affiliate company should be subject to zero percent tolerance, even if the affiliate uses vendors to perform the title services.We do not have a TRID risk assessment at this time beyond the initial risk assessment in the DSMU. We appreciate the suggestion and will add it to our list of requested items from members.
If you go to page 912 (https://files.consumerfinance.gov/f/201311_cfpb_final-rule-preamble_integrated-mortgage-disclosures.pdf) of the preamble it discusses whether or not lender credits are factored into the “In 5 Years” (and therefore, “total of payments”).
It states: “The Bureau does not believe that the total loan costs factored into the “In 5 Years” disclosure should account for lender credits. As disclosed under
§ 1026.37(f) and reflected in the Closing Cost Details on page 2 of the Loan Estimate, total loan costs include origination charges, services the consumer cannot shop for, and services the consumer can shop for, but do not include lender credits. The total loan costs, along with other costs such as taxes and other government fees, prepaid charges, and the initial escrow payment at closing, combined with lender credits, compose the total closing costs disclosed under § 1026.37(h), which is a separate and distinct metric.”
