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September 22
FinCEN's Beneficial Owners Proposal: What It Can Mean for You;
Sonja Kriegsmann and John Burnett

September 23
Bankruptcy 101;
Sam Ott

September 30
Revised Escrow Rules - Review and Update;
Jack Holzknecht and Mary Beth Guard

October 7
CRA - Digging for Credit;
Patricia Cashman

October 8
Applicants and Applications: Knowing the Players and the Rules;
David Dickinson

October 15
MasterCard and Reg E: Basic Debit Card Investigations;
Brian Crow



Topic Options
#1255299 - 09/23/09 10:59 AM HPML & Loan Pricing Guidelines
ldsnanny Offline
Gold Star

Registered: 10/31/06
Posts: 437
Does your bank have a loan pricing guideline that you give your loan officers for your home loans? If so, do you list the actual rates they can charge or do you put a statement on there that tells them to refer to the HPML limits?

Thanks

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Lending Compliance
#1255524 - 09/23/09 01:25 PM Re: HPML & Loan Pricing Guidelines [Re: ldsnanny]
CompDat Offline
Platinum Poster

Registered: 12/21/05
Posts: 553
Loc: USA
Any bank should have these. If you don't, I am not sure how you passed your fair lending reviews.
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#1255545 - 09/23/09 01:38 PM Re: HPML & Loan Pricing Guidelines [Re: ldsnanny]
upstateNY Offline
Platinum Poster

Registered: 04/24/03
Posts: 933
Loc: New York State
Absolutely, we have published rate sheets, from which the lenders must not vary.

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#1255595 - 09/23/09 02:08 PM Re: HPML & Loan Pricing Guidelines [Re: upstateNY]
swiggles Online
Power Poster

Registered: 08/14/01
Posts: 5764
Our lenders are given rate guidelines (can't deviate). HPML spreads are not an issue with our lenders. Since the HPML is based on the APR, rather than the loan rate, there's really no way for the lender to know if the loan has hit the HPML trigger or not.....and we're not tryng to avoid HPML. If a loan hits the trigger, it does. We already verify borrower's ability to repay with documentary proof....we already give weight to "mortgage obligations" with respect to the borrower's ability to repay. The only change we've made is that we no longer offer a 5-year balloon term...period. If a balloon loan is desired, seven years is the minimum and is generally our standard product. Then the HPML is reported on the HMDA Lar.
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#1256033 - 09/23/09 11:32 PM Re: HPML & Loan Pricing Guidelines [Re: swiggles]
jlroberts Offline
Diamond Poster

Registered: 09/07/09
Posts: 1410
Loc: Ohio
We also have a rate sheet for the lenders to use. We have performed the HPML test on all the APRS on the rate sheet and currently all our products have been identified as HPML's. And like swiggles we already underwrite our loans based on the ability to repay (including escrow items even if they do not escrow) with supporting documentation. Based on our findings we only need to make two changes: 1) We will no longer offer our 1/1 and 3/1 ARM pre-payment penalty products and 2) Effective April 2010 we will start requiring escrow accounts on all loans subject to Reg Z. Which pretty much means that they will now have a savings account that they can close after the first 12 months.

We feel the 10/01/09 requirements will go smoothly within our shop. We're a bit more challenged with the 01/01/10 requirements.

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#1256035 - 09/23/09 11:45 PM Re: HPML & Loan Pricing Guidelines [Re: jlroberts]
rlcarey Offline
10K Club

Registered: 07/16/01
Posts: 50035
Loc: Galveston, TX
"Which pretty much means that they will now have a savings account that they can close after the first 12 months"

Well, it is a little more complicated than that. You have to establish the escrow account, provide an initial statement, make the required payments on time, abide by the accounting rules for the account, provide annual statements, etc.
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#1256037 - 09/24/09 12:03 AM Re: HPML & Loan Pricing Guidelines [Re: rlcarey]
jlroberts Offline
Diamond Poster

Registered: 09/07/09
Posts: 1410
Loc: Ohio
Not complicated at all since we are aware of our responsiblities for establising and the administration of an escrow account. smile I am glad you clarified that, especially for those creditors out there that have never had escrow accounts.

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#1256063 - 09/24/09 08:40 AM Re: HPML & Loan Pricing Guidelines [Re: jlroberts]
Dan Persfull Offline
10K Club

Registered: 08/28/02
Posts: 40755
Loc: Bloomington, IN
You will also need to check your state laws as some states require you to pay interest on escrow accounts.
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The opinions expressed are mine and they are not to be taken as legal advice.

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#1256167 - 09/24/09 10:14 AM Re: HPML & Loan Pricing Guidelines [Re: Dan Persfull]
#Just Jay Online
10K Club

Registered: 10/26/06
Posts: 13641
Loc: Cheeseheadland
Originally Posted By: Dan Persfull
You will also need to check your state laws as some states require you to pay interest on escrow accounts.


And even set the rate for you. At least they do here.
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#1256443 - 09/24/09 02:05 PM Re: HPML & Loan Pricing Guidelines [Re: #Just Jay]
Runnin' on Empty Offline
100 Club

Registered: 08/15/02
Posts: 149
We would like to price our loans so that we can avoid as many HPML's as possible. To accomplish this, we need to change rates weekly, right?

If anyone has a method of automating the bank rates to avoid HPML's...please advise me.

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#1256613 - 09/24/09 03:33 PM Re: HPML & Loan Pricing Guidelines [Re: Runnin' on Empty]
Runnin' on Empty Offline
100 Club

Registered: 08/15/02
Posts: 149
Bump.

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