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#1290761 - 11/20/09 06:38 PM Re: RESPA changes 1-1-10 Sage
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Sage-from the OTS/HUD powerpoint, page 25, it states: "If a loan originator permits a borrower to shop for services (Block 4,5 and 6) the loan originator must provide a written list of providers the estimates were based on." None of the references I have seen state a provider list is required for insurance.
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#1290772 - 11/20/09 06:45 PM Re: RESPA changes 1-1-10 TB 12
RobinB Offline
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I've attended two training sessions in which the instructor could not answer the insurance question.

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#1290787 - 11/20/09 06:51 PM Re: RESPA changes 1-1-10 TB 12
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Originally Posted By: Sox in 07
Truff-that is correct-they sign the documents themselves-no addendum (although there is an addendum to the HUD for FHA loans).
So even tho there are no signature lines on the new HUD, you're going to have the borrowers sign it? Same with the GFE? Have you run this by any of your investors or did you just decide to run with it?

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#1290795 - 11/20/09 06:55 PM Re: RESPA changes 1-1-10 TB 12
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Somewhere in the middle
Originally Posted By: Sox in 07
Sage-from the OTS/HUD powerpoint, page 25, it states: "If a loan originator permits a borrower to shop for services (Block 4,5 and 6) the loan originator must provide a written list of providers the estimates were based on." None of the references I have seen state a provider list is required for insurance.


I second Soxs opinion. Home owners insurance is in Block 11 of the GFE and is not referenced in the list provisions of the reg.
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#1290819 - 11/20/09 07:05 PM Re: RESPA changes 1-1-10 DD Regs
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I agree with you guys on Block 11, but I guess I just missed the fact that you needed to list for Block 5 Owners Title Ins. This seems crazy to list title insurance companies for an optional product, especially when our bank doesnt let borrowers shop for lender title services. Did I understand this correctly?
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#1290825 - 11/20/09 07:08 PM Re: RESPA changes 1-1-10 DD Regs
Sage Offline
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But see:
FAQs (11/19/09), page 11.

Q: When do loan originators have to provide the borrower with a written list of identified providers?
A: When a loan originator permits a borrower to shop for third-party settlement services, the loan originator must provide the borrower with a written list of settlement services providers at the time of the GFE, on a separate sheet of paper.

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#1290836 - 11/20/09 07:13 PM Re: RESPA changes 1-1-10 Trixie
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Originally Posted By: Trixie
Third Party Service Provders - Block 6- If the offer to purchase has listed Well, home inspection etc. Do we need to provide a Providers List? This is something the seller ususally pays for and is ordered by the Realtor. Very confusing how would the bank know who to list on the provider list and keep up on the fees.


If you (the lender) are not requiring it, you will just list those extra services in a blank line in the 1300 section of the HUD.

You only need lists for services you REQUIRE, but will allow your borrower to shop for...blocks 4,5 and 6 items.
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#1290840 - 11/20/09 07:21 PM Re: RESPA changes 1-1-10 RR Joker
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GFE – Block 11
1) Q: What types of insurance are included on the GFE, Block 11, Homeowner‘s insurance?
A: Block 11 of the GFE contains estimates for premiums for all types of insurance (other than title insurance) that must be purchased to meet the loan originator‘s requirements to protect
the property from loss, such as hazard insurance (homeowner‘s insurance), flood insurance, and earthquake insurance.
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#1290843 - 11/20/09 07:26 PM Re: RESPA changes 1-1-10 David Dickinson
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Originally Posted By: David Dickinson
Originally Posted By: Weeble Woman
If I accept an application in December 2009 and use the current GFE, which GFE do I use if I need to redisclose after January 2010? Thanks for any and all replies, and I apologize if this has already been addressed and I couldn't find it.

Q&A #3 from the GFE General section:
3) Q: If a GFE is issued on the old form prior to January 1, 2010, and the loan will close after January 1, 2010, which HUD-1 form is to be completed by the settlement agent?
A: If a GFE is issued on the old form prior to January 1, 2010, then the old HUD-1 form must be used even if closing will occur after January 1, 2010. For GFEs issued on the old form, the loan originator has the option to reissue the GFE (with the same terms and charges) on the new form, in which case the settlement agent must complete the new HUD-1 form.


I have the same question and I don't think the Q & A answers it...The Q and A basically states that you have the option to reissue the GFE on the new form if you want to use the new HUD-1. The question is do we have to use the new GFE after 1/1/10 if we are reissuing a GFE due to a changed circumstance when the original GFE was prior to 1/1/10?

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#1290846 - 11/20/09 07:29 PM Re: RESPA changes 1-1-10 kristin09
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Does anyone charge Fannie Mae LLPAs? The most recent Q and A addresses a loan level price adjustment question but responds to it when talking about a mortgage broker transaction. The Fannie Mae LLPA appears to not fit into this category and should be included in the origination charge. Any thoughts?

Q: A loan level price adjustment is a risk-based adjustment that is derived from specific attributes of the particular loan (LTV, FICO score, occupancy, etc.). How should a loan level price adjustment charged by the lender be disclosed on the GFE?
A: For transactions involving a mortgage broker, the credit or charge for the specific interest rate chosen is the net payment from the lender for the loan. If the net payment from the lender is positive, there is a credit to the borrower and it is entered as a negative amount in Block 2 of the GFE. If the net payment from the lender is negative, there is a charge to the borrower and it is entered as a positive amount in Block 2 of the GFE. The loan level price adjustment is included in the computation in Block 2, “Your credit or charge for the specific interest rate chosen.”

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#1290856 - 11/20/09 07:34 PM Re: RESPA changes 1-1-10 RR Joker
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To those of you who are questioning the need or not a need for lists of insurors. Insurance is not a required SETTLEMENT service provider. They are a third party and they are a service provider...but they are not a settlement provider, per se.

Only those providers in 4, 5 and/or 6, that you will allow them to shop for need a list. If they choose from your list, you have a 10% tolerance limit.

Commonly, attorney, surveyor, termite, HUD counseling and again, ONLY if you allow them to shop for the above.

Insurance has no tolerance issues and is in the category #3 on page 3 of the GFE (estimates that can change).

Perhaps go beyond the Q&A and to the regulation itself, page 68254, "Your charges for all other settlement services where the written list is discussed. You will see no mention of anything except 4, 5 and 6 items.
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#1290861 - 11/20/09 07:36 PM Re: RESPA changes 1-1-10 kristin09
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Originally Posted By: kristin09
Originally Posted By: David Dickinson
Originally Posted By: Weeble Woman
If I accept an application in December 2009 and use the current GFE, which GFE do I use if I need to redisclose after January 2010? Thanks for any and all replies, and I apologize if this has already been addressed and I couldn't find it.

Q&A #3 from the GFE General section:
3) Q: If a GFE is issued on the old form prior to January 1, 2010, and the loan will close after January 1, 2010, which HUD-1 form is to be completed by the settlement agent?
A: If a GFE is issued on the old form prior to January 1, 2010, then the old HUD-1 form must be used even if closing will occur after January 1, 2010. For GFEs issued on the old form, the loan originator has the option to reissue the GFE (with the same terms and charges) on the new form, in which case the settlement agent must complete the new HUD-1 form.


I have the same question and I don't think the Q & A answers it...The Q and A basically states that you have the option to reissue the GFE on the new form if you want to use the new HUD-1. The question is do we have to use the new GFE after 1/1/10 if we are reissuing a GFE due to a changed circumstance when the original GFE was prior to 1/1/10?


No. You will not be dealing with "changed circumstances" on loan applications taken prior to 1/1/2010.
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#1290866 - 11/20/09 07:38 PM Re: RESPA changes 1-1-10 RR Joker
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I didn't see it referenced in the last couple of pages, but you're all aware that HUD issued a second FAQ this week, on 11-19? Fairly warned be thee...
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#1290906 - 11/20/09 08:08 PM Re: RESPA changes 1-1-10 Sage
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Regarding Block 4 of the GFE, when we provide a written list of providers, does the list need to include the names of title insurance companies (Chicago Title, Lawyer's Title, First American Title, etc.) or just the names of attorneys and settlement agents?

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#1290910 - 11/20/09 08:10 PM Re: RESPA changes 1-1-10 elcinoca
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Hey, they answered the signature line question! wink

elcinoca...that may depend on the part of the country you live in...for us...it will be attorney's.
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#1290998 - 11/20/09 09:16 PM Re: RESPA changes 1-1-10 Sage
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Originally Posted By: Sage

But see:
FAQs (11/19/09), page 11.

Q: When do loan originators have to provide the borrower with a written list of identified providers?
A: When a loan originator permits a borrower to shop for third-party settlement services, the loan originator must provide the borrower with a written list of settlement services providers at the time of the GFE, on a separate sheet of paper.



In the HUD FAQ's in that same section - go down to #4 - it clarifies it is for blocks 4-5-6.
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#1290999 - 11/20/09 09:16 PM Re: RESPA changes 1-1-10 RR Joker
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How does that reconcile with Section 3500.2 of Reg X that defines a "Settlement service" as:

Sec. 3500.2 Definitions

Settlement service means any service provided in connection with a prospective or actual settlement, including, but not limited to, any one or more of the following:
(11) Provision of services involving hazard, flood, or other casualty insurance or homeowner's warranties;

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#1291013 - 11/20/09 09:25 PM Re: RESPA changes 1-1-10 RR Joker
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I need a little clarification on how to list the negative amount on the Adjusted Origination Charges section for a home equity loan without any fees. If I am not charging any fees I know I have to list the negative amount in this section, but am confused on which block to put it in. If I put the negative amount in Block 2, which box should be checked off? If I put it in block 1, do I have to check off the first box in block 2?

I know it says to list a negative number in Block 2 to offset all fees encompassed in the no cost loan in their guide, but it doesn't explain if we should check off a box and it doesn't make sense to put a negative amount there and not check anything.

Does anyone have an answer for this?

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#1291047 - 11/20/09 09:45 PM Re: RESPA changes 1-1-10 RR Joker
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Originally Posted By: RR joker
Hey, they answered the signature line question! wink

Who? Where? When?

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#1291064 - 11/20/09 09:54 PM Re: RESPA changes 1-1-10 RR Joker
elcinoca Offline
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Originally Posted By: RR joker
elcinoca...that may depend on the part of the country you live in...for us...it will be attorney's.


I guess I am getting hung up on the term service provider. We close real estate loans using attorneys, so they are the "Title Services" provider. The title insurance company (Lawyer's Title, Chicago Title, First American Land Title, etc.) issues the actual insurance policy, thus they are the "Lender's title insurance" provider.

To take this a step further, if we go to Block 5, the Attorney doesn't provide the Owner's title insurance -- the insurance company does.

I am making too much of this huh?

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#1291121 - 11/20/09 10:45 PM Re: RESPA changes 1-1-10 creditcommander
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For no cost loans, you would check the second box in block 2 with a negative # in the column. Blk 1 would not be a negative #.

Example: Bank is paying $300 toward fees. All of the $100 orig chg and $200 for the 3rd party appraisal. Blk 1 lists orig chg as $100. Blk 2, 2nd ck off box, put $300 cr (out in the column put -$300). Then in A "Your Adj Orig Chg" you would put ($200).
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#1291166 - 11/21/09 01:56 AM Re: RESPA changes 1-1-10 Truffle Royale
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Originally Posted By: Truffle Royale
Originally Posted By: RR joker
Hey, they answered the signature line question! wink

Who? Where? When?


New FAQ dated 11/19/09 - yes, just 2 days after the last one page 9

28) Q: May a loan originator alter the GFE by adding signature lines to the GFE?
A: No. However, loan originators may develop practices and procedure to document the consumer's acknowledgement of receipt of the GFE. Loan originators may not refuse to provide a GFE based upon a consumer's refusal to acknowledge receipt of the GFE. Acknowledgment of receipt of a GFE, by itself, does not constitute an expression of an intention to proceed with the loan covered by the GFE.

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#1291168 - 11/21/09 02:13 AM Re: RESPA changes 1-1-10 jlroberts
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When does a GFE expire? Page 10 of FAQ states the answer as: If a borrower does not express an intent to continue with an application within ten business days after the GFE is provided (or such longer time period specified by the loan originator), the loan originator is no longer bound by the GFE.

This is the only answer I can find about the GFE expiring. SO... if the borrower comes in on the 11th day and says "I want to proceed with the loan", the loan originator can then charge whatever they want on the HUD.

What am I missing?? How is everyone else planning on documenting "intent" within the 10 days or non-intent as of the 11th day?

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#1291185 - 11/21/09 02:17 PM Re: RESPA changes 1-1-10 elcinoca
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Originally Posted By: elcinoca
Originally Posted By: RR joker
elcinoca...that may depend on the part of the country you live in...for us...it will be attorney's.


I guess I am getting hung up on the term service provider. We close real estate loans using attorneys, so they are the "Title Services" provider. The title insurance company (Lawyer's Title, Chicago Title, First American Land Title, etc.) issues the actual insurance policy, thus they are the "Lender's title insurance" provider.

To take this a step further, if we go to Block 5, the Attorney doesn't provide the Owner's title insurance -- the insurance company does.

I am making too much of this huh?

We have the same structure here-attorneys handle the closing, and they order the title insurance through whoever they work with. I don't plan on listing that title insurance co as a provider since the cost is disclosed in box 4 and there is no requriement to list providers or break out costs in box 4.
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#1291186 - 11/21/09 02:19 PM Re: RESPA changes 1-1-10 jlroberts
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Originally Posted By: jlroberts
When does a GFE expire? Page 10 of FAQ states the answer as: If a borrower does not express an intent to continue with an application within ten business days after the GFE is provided (or such longer time period specified by the loan originator), the loan originator is no longer bound by the GFE.

This is the only answer I can find about the GFE expiring. SO... if the borrower comes in on the 11th day and says "I want to proceed with the loan", the loan originator can then charge whatever they want on the HUD.

What am I missing?? How is everyone else planning on documenting "intent" within the 10 days or non-intent as of the 11th day?


In that scenario if the borrower comes back on day 11, you are not obligated to the fees quoted back on day one-you need to issue a new GFE, but you are not bound by the fees quoted on the first GFE.
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