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The Real Estate Settlement Procedures Act (Regulation X) has contained rules for administering escrow accounts for many years. Both the Truth in Lending Act (Regulation Z) and the interagency flood regulations contain provisions that require escrows in connection with certain loans. The Real Estate Settlement Procedures Act and Regulation X have requirements for establishing and maintaining escrow accounts. Some of those rules are changing
Higher-Priced Mortgage Loans – On January 19, 2021, the Consumer Financial Protection Bureau (CFPB) issued a final rule amending section 1026.35 of Regulation Z to implement a requirement of the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA). The final rule exempts certain insured depository institutions and insured credit unions from the requirement to establish escrow accounts for certain higher-priced mortgage loans (HPMLs).
It exempts from the HPML escrow requirement any loan made by an insured depository institution or insured credit union and secured by a first lien on the principal dwelling of a consumer if
- The institution has assets of $10 billion or less;
- The institution and its affiliates originated 1,000 or fewer loans secured by a first lien on a principal dwelling during the preceding calendar year; and
- Certain of the existing HPML escrow exemption criteria are met.
Flood Insurance Frequently Asked Questions – During 2022, the Board of Governors of the Federal Reserve System, the Farm Credit Administration, the Federal Deposit Insurance Corporation, the National Credit Union Administration, and the Office of the Comptroller of the Currency (jointly, the agencies) issued revised questions and answers (Q&As) regarding federal flood insurance law and the agencies’ implementing regulations. The Q & As address a number of flood related topics including escrow rules. The revised Q & As were effective upon publication
This webinar recording covers all of the escrow rules, including the long standing and the recently revised requirements of the flood regulations, Regulation X and Regulation Z.
This recording provides comprehensive coverage of the flood regulations, Regulation X and Regulation Z escrow rules. We explain, step-by-step, how to establish, maintain, and cancel escrow accounts under the amended requirements. In addition, suggestions for avoiding violations and penalties are provided.
You’ll receive a detailed manual that provides a thorough explanation of all the escrow rules. Both the recording materials are updated for the revisions resulting from the final rule
Upon completion of the program participants understand:
- Which loans are required by Regulation Z and the flood regulations to have escrow accounts, and which are exempt;
- The limitations on the amount of the required escrow payments at origination and over the life of the loan;
- How to conduct an escrow analysis;
- How to determine an escrow account computation year;
- The calculation of the amount of the allowed cushion;
- The rules for preparing the initial escrow account disclosure statement;
- The TRID rules regarding the escrow notices required in the Closing Disclosure;
- The expanded Flood Hazard Notice for Escrow information;
- The flood insurance option to escrow notice;
- How to prepare the annual escrow account statement;
- How to resolve a surplus, a deficiency or a shortage;
- Regulation X rules for timely escrow payments and treatment of escrow balances;
- Regulation Z rules regarding escrow cancellation notices;
- The recordkeeping rules for escrow accounts;
- The penalties for the failure to submit an initial or annual escrow account statement; and
- The proposed revisions to the Regulation Z rules made by the EGRRCPA.
The program is designed for compliance officers, operations personnel, mortgage loan officers, loan originators and others involved in opening and maintaining escrow accounts for mortgage loans.