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#1356746 - 03/12/10 04:19 PM Re: RESPA changes 1-1-10 rlcarey
#Just Jay Offline
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#Just Jay
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Cheeseheadland
Followup to my HUD convo on homeowners on the GFE and HUD for refi's:

Originally Posted By: Anthony HUD
The HUD-1 can be used in the same manner, but on refinances Homeowner’s insurance does not have to be disclosed on the GFE for refinances since the lender may presume that the borrower is up to date on their insurance, even though you require it to be paid. If not then you can issue a revised GFE based upon changed circumstances if the borrower was not updated on the GFE and show on the HUD-1 the payments that were due prior to closing in the same manner as a purchase.


Originally Posted By: Jay
Now that is an interesting response. I think myself and many of my colleagues did not have this interpretation of Box 11 on the GFE. Many of us have felt that since Homeowners Insurance is on the GFE, and the preamble to the Appendix C states “…The required standardized GFE form must be prepared completely and accurately.” Also, since we require that homeowners insurance is required to close the loan, that it essentially is required of the loan, hence to be listed on the GFE and HUD. The ability to ‘presume’ that it is up to date doesn’t seem to be in the spirit of rule, nor is it something we were allowed to do in the past. Several banks, ourselves included, have been cited by examiners for not listed the homeowners insurance as a POC item, even on refinances.

Admittingly, I am hesitant to not list it for refinances unless I could comfortably cite a specific rule or citation in Appendix C, or via some other commentary. Do you know or have something more concrete I can point to that shows that not including homeowners insurance on the GFE and HUD for policies paid outside of closing for a refinance is deemed acceptable?


Originally Posted By: Anthony HUD
For clarification, you still must list Homeowner’s insurance on the GFE but if it is a refinance you can assume it is up to date and disclose a “$0” amount in the column on the GFE. If later it becomes clear that the homeowner’s insurance amount is not updated you can re-disclose or show on the HUD-1 the amount necessary in the 1300’s “charges that can increase.”


I still do not like his 'assume' commenting. I replied back further about my examining body not so big on making assumptions, and will be retaining his email for their review smile
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RESPA
#1356908 - 03/12/10 06:15 PM Re: RESPA changes 1-1-10 RR Joker
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My bank does not charge a credit report fee to the borrower in a mortagage transaction. We do however, get a credit report before proceeding with a loan. We eat that cost. That cost is not passed on to the borrower. Would that fee that we are paying to the credit reporting agency be required to be shown on the GFE? It sounds like the new GFE rule requires that we show that fee??? However, I liken it to showing the lender's telephone bill on the GFE since we had to use the phone to call an appraiser or showing our light bill on the GFE since we needed lights to process the loan application. We need the credit report to process the application and we are paying for it.

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#1356955 - 03/12/10 07:00 PM Re: RESPA changes 1-1-10 Mrs. Rizzo
RobinB Offline
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Maryland
Originally Posted By: Rizzo
Has anyone put together an example list for changed circumstances? We're working on examples for our staff and thought I would ask.

Thanks!!


Don't have a list, but did here a good rule-of-thumb yesterday at a broker meeting: "If it's the borrower's request, it's a changed circumstance. If it affects your profitability, it's not."
Last edited by RobinB; 03/12/10 07:02 PM.
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#1356971 - 03/12/10 07:09 PM Re: RESPA changes 1-1-10 RobinB
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The appraisal referenced was from another 3rd party, mortgage lender, but our borrower has already paid for it. It does not change any of the fees on the GFE or even to the HUD when prepared. Do we need to re-disclose for a p.o.c. appraisal.

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#1356975 - 03/12/10 07:11 PM Re: RESPA changes 1-1-10 Working From Home
raitchjay Online
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Yes you have to disclose the credit report fee. If you want to absorb the fee, show a credit in Block 2. Not commenting on the logic on that .....but this has been discussed ad nauseum in here and you definitely have to show it.
Last edited by raitchjay; 03/12/10 07:13 PM.
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#1356978 - 03/12/10 07:13 PM Re: RESPA changes 1-1-10 river girl
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Originally Posted By: river girl
Management just came to me and said we are signing an agreement with a company to assist us in doing FHA loans.
In the agreement is a statement that all loans closed will be assessed a pre-purchase, post closing review fee of $399.
This fee will be passed to the consumer.
Would I put this in as an admin fee so in block 1?
Management also wants to know if they can up the rate 1/8 and not pass this fee to the consumer and then not list anywhere? I told them no. Is that correct?


Block 1
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#1356982 - 03/12/10 07:16 PM Re: RESPA changes 1-1-10 Working From Home
RR Joker Offline
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Originally Posted By: Monica1001
My bank does not charge a credit report fee to the borrower in a mortagage transaction. We do however, get a credit report before proceeding with a loan. We eat that cost. That cost is not passed on to the borrower. Would that fee that we are paying to the credit reporting agency be required to be shown on the GFE? It sounds like the new GFE rule requires that we show that fee??? However, I liken it to showing the lender's telephone bill on the GFE since we had to use the phone to call an appraiser or showing our light bill on the GFE since we needed lights to process the loan application. We need the credit report to process the application and we are paying for it.


you could run a search in this forum on Credit report fees and probably find all the info you wanted on this topic. The new rules done't require it...the rules have always required it. It's a service provider fee. The phone and electric company are not.
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#1356992 - 03/12/10 07:23 PM Re: RESPA changes 1-1-10 RR Joker
raitchjay Online
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Joker....it may have always been required...but....i know lots of banks didn't use to itemize it on the GFE...our bank for example paid for it out of the doc. fee...i think that's where all the confusion comes from.
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#1357282 - 03/12/10 11:14 PM Re: RESPA changes 1-1-10 raitchjay
river girl Offline
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For line 1400 on the Hud 1a, do we include or exclude the items paid outside of closing by either the borrower or by the FI?
We are currently excluding those fees p.o.c. from the total showing in line 1400.

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#1357825 - 03/15/10 08:55 PM Re: RESPA changes 1-1-10 RR Joker
river girl Offline
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I having trouble finind any reference to correspondent lending. All of the FAQs and other resources only address mortgage broker fees and the new gfe / hud.
Do I just follow the mortgage broker guidance for our future correspondent lending relationship and how to reflect their fees on the gfe/hud?
Thank you for your help. I am in new territory and am quite confused.

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#1358007 - 03/16/10 01:52 PM Re: RESPA changes 1-1-10 river girl
RR Joker Offline
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POC items would not show in the total.

Regarding correspondent lending. If the "correspondent lender" does not close and fund in their own name with their own funds, then you treat it like a "broker" transaction. The key is who funds...the customer's contact, or a differnt lending institution??
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#1358579 - 03/16/10 10:36 PM Re: RESPA changes 1-1-10 RR Joker
river girl Offline
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Regarding correspondent lending...I was told We will be closing and funding the loan in our name and then sending to correspondent to purchase.

Does this mean I don't follow any of the guidance in the FAQs for mortgage brokers? It is all too confusing to try and figure this out for something I have no idea about.

In an earlier post I was told to put the correspondent's $399 fee that is being passed to the consumer for the post closing review in Block 1 of the GFE. Is it for sure that we can't we pay the fee and just increase the rate to the consumer?

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#1358624 - 03/17/10 02:54 AM Re: RESPA changes 1-1-10 river girl
David Dickinson Offline
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Central City, NE
If you fund the loan, you are not a broker.
All fee by all lenders (including 2nd Market fees), go in Block 1.
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#1358744 - 03/17/10 01:43 PM Re: RESPA changes 1-1-10 David Dickinson
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agree with what David said and how he said it...short, sweet and totally on point!
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#1358790 - 03/17/10 02:11 PM Re: RESPA changes 1-1-10 RR Joker
ramona Offline
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If someone wants to obtain a pre-qualification on a mortgage loan and we have pulled a credit report to help make a determination to allow the potential applicant to know how much they may be able to borrow, but do not have a property identified, we do not have a true application according to RESPA. But according to Reg B, if the potential applicant decides they don't want to proceed because we indicated they could only borrow $XXX instead of $YYY, do we have a true withdrawal? Also, if we indicate to the potential applicant that we could only loan $YYY instead of their target of $XXX, do we have a denial?
Last edited by ramona; 03/17/10 02:32 PM.
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#1358952 - 03/17/10 03:24 PM Re: RESPA changes 1-1-10 ramona
biz Offline
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Midwest
The way I understand it is once a loan has gone by committee, (in your case someone decided you did not not want to loan X but would loan Y-therefore going by committee) it can not be "withdrawn" by the customer and should continue to be processed accordingly. And yes, if you do not approve a loan substantially the same way as applied and the borrower does not take your "counteroffer" it would be a denial and subject to an Adverse Action Notice.

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#1359030 - 03/17/10 03:56 PM Re: RESPA changes 1-1-10 biz
Strange1 Offline
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Ohio
How would the RESPA cure provision operate if the customer never receives a GFE prior to closing? Would this be tantamount to disclosing a blank GFE necessitating a cure for all fees? Or is the cure provision not applicable, thus leaving no avenue for remedying the violation? Thanks

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#1359098 - 03/17/10 04:32 PM Re: RESPA changes 1-1-10 RR Joker
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On a GFE...where would I list a broker credit report fee that is not a required service by us, since we pull our own and charge for it?

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#1359162 - 03/17/10 05:22 PM Re: RESPA changes 1-1-10 mbtprocessor
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Did anyone see that HUD is hosting a webcast tomorrow 3/18 from 1:30 - 3:30 ET on RESPA?

http://www.hud.gov/offices/hsg/ramh/res/respa_hm.cfm Look at the "Watch the Webcast" section on the right hand side of this web page. I clicked on the link they provided and it takes me to the following page.

http://portal.hud.gov/portal/page/portal/HUD/webcasts/schedule

It is not clear whether we need to register for this.
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#1359209 - 03/17/10 05:54 PM Re: RESPA changes 1-1-10 Reads Regs
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Originally Posted By: Reads Regs
Did anyone see that HUD is hosting a webcast tomorrow 3/18 from 1:30 - 3:30 ET on RESPA?

http://www.hud.gov/offices/hsg/ramh/res/respa_hm.cfm Look at the "Watch the Webcast" section on the right hand side of this web page. I clicked on the link they provided and it takes me to the following page.

http://portal.hud.gov/portal/page/portal/HUD/webcasts/schedule

It is not clear whether we need to register for this.


Thanks for posting this!

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#1359226 - 03/17/10 06:12 PM Re: RESPA changes 1-1-10 Bullseye
manylayers Offline
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manylayers
Joined: Nov 2009
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PA
I have this on my calendar!!! I'm doing my first review of loan applications post 1-1-10...and trying to keep all the rules straight....and hoping that i'm not misunderstanding any fundamental parts of the new GFE and HUD.

What i am seeing is that we need to do a better job of documenting when and why a GFE is reissued. and when an interest rate is locked and when it is not.

Has anyone else begun to audit their files? what are you finding?
suggestions for improvement?

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#1359929 - 03/18/10 04:43 PM Re: RESPA changes 1-1-10 Reads Regs
pjs Offline
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oHiO
Originally Posted By: Reads Regs
Did anyone see that HUD is hosting a webcast tomorrow 3/18 from 1:30 - 3:30 ET on RESPA?

http://www.hud.gov/offices/hsg/ramh/res/respa_hm.cfm Look at the "Watch the Webcast" section on the right hand side of this web page. I clicked on the link they provided and it takes me to the following page.

http://portal.hud.gov/portal/page/portal/HUD/webcasts/schedule

It is not clear whether we need to register for this.


Yes, we are setting up for it now. High hopes this will be good and not confusing.

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#1359931 - 03/18/10 04:46 PM Re: RESPA changes 1-1-10 pjs
Dan Persfull Offline
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Bloomington, IN
Quote:
High hopes this will be good and not confusing.


ROTFLMAO
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#1359943 - 03/18/10 05:03 PM Re: RESPA changes 1-1-10 Dan Persfull
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Dan! People are looking at me funny for my outburst. laugh

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#1359977 - 03/18/10 05:39 PM Re: RESPA changes 1-1-10 Truffle Royale
JustMe Offline
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Joined: Nov 2007
Posts: 49
Is it just me or has the webcast not started yet? I just have the purple box with the title and says it will start in a minute. It's been that way for 10 minutes now.

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