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#1500094 - 01/25/11 09:05 PM Re: New MDIA Disclosures Effective Jan 30, 2011 RR Joker
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Is the Credit Sale disclosure for when the BANK sells a piece of property? That is what JH is telling us, but I can't see that when reading this but I can't find when it should be used:

(j) Total sale price. In a credit sale, the total sale price, using that term, and a descriptive explanation (including the amount of any downpayment) such as “the total price of your purchase on credit, including your downpayment of $----.” The total sale price is the sum of the cash price, the items described in paragraph (b)(2), and the finance charge disclosed under paragraph (d) of this section.

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#1500102 - 01/25/11 09:12 PM Re: New MDIA Disclosures Effective Jan 30, 2011 Slugbug
Sheldon Hendrix Offline
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Originally Posted By: Slugbug
Is the Credit Sale disclosure for when the BANK sells a piece of property? That is what JH is telling us, but I can't see that when reading this but I can't find when it should be used:

(j) Total sale price. In a credit sale, the total sale price, using that term, and a descriptive explanation (including the amount of any downpayment) such as “the total price of your purchase on credit, including your downpayment of $----.” The total sale price is the sum of the cash price, the items described in paragraph (b)(2), and the finance charge disclosed under paragraph (d) of this section.



Yes, it only applies if you are selling an "other asset" and also financing it.

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#1500107 - 01/25/11 09:15 PM Re: New MDIA Disclosures Effective Jan 30, 2011 swiggles
Sheldon Hendrix Offline
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Originally Posted By: swiggles


Where in Reg Z is this mysterious "e" discussed? I can't find it. It's always been included in closed end lines, but not in amortizing loans where the entire loan amount is funded at closing.


12 CFR § 226.17(c)(2)(i)
If any information necessary for an accurate disclosure is unknown to the creditor, the creditor shall make the disclosure based on the best information reasonably available at the time the disclosure is provided to the consumer, and shall state clearly that the disclosure is an estimate.

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#1500109 - 01/25/11 09:15 PM Re: New MDIA Disclosures Effective Jan 30, 2011 ahkcompliance
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For fixed rate int only pmt balloon loans, Laser Pro leaves off the intro rate/pmt & max ever headings - displaying only one column. This makes sense because there is no into rate/pmt and max ever/first incr.

You'd only need those column headings if some pmts were int only (into rate/pmt) and other pmts were P & I.
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#1500126 - 01/25/11 09:33 PM Re: New MDIA Disclosures Effective Jan 30, 2011 Sheldon Hendrix
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Originally Posted By: Compliance Rules
Originally Posted By: swiggles


Where in Reg Z is this mysterious "e" discussed? I can't find it. It's always been included in closed end lines, but not in amortizing loans where the entire loan amount is funded at closing.


12 CFR § 226.17(c)(2)(i)
If any information necessary for an accurate disclosure is unknown to the creditor, the creditor shall make the disclosure based on the best information reasonably available at the time the disclosure is provided to the consumer, and shall state clearly that the disclosure is an estimate.


Well, so I'm confused. Why would an "e" be needed for a preliminary disclosure statement? The disclosures are accurate based on the information provided at the time....the loan amount, interest rate, payment schedule, etc. We use two docprep systems.....one for mortgage loans destined for the secondary market (Wolters Kluwer) and the other for in-house loans including HI and HE loans (LaserPro). Wolters includes an "e" in the PTIL, LaserPro does not. This makes me uneasy.
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#1500158 - 01/25/11 10:07 PM Re: New MDIA Disclosures Effective Jan 30, 2011 swiggles
Sheldon Hendrix Offline
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The "e" is really supposed to indicate that some terms could be based on estimates. As RR noted, really only your construction loans will truly require an "e" in most instances I think. I think the "e" gets include as an abundance of caution, although I don't really know if it accomplishes anything.

We use two systems as well, WKFS - in-house, and Encompass - secondary market. Both include an "e" for all early disclosures.

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#1500168 - 01/25/11 10:31 PM Re: New MDIA Disclosures Effective Jan 30, 2011 Sheldon Hendrix
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The new truth in lending disclosure will apply to all consumer purpose loan applications that are to be secured by Residential Real Estate, Undeveloped land & personal property that is also a dwelling (mobile home). Correct? Back in 2009-till now the early truth in lending only applied to RESPA covered loans; however, that is no longer true. Correct? One of regulators told us that the new early truth in lending disclosure will still apply to RESPA covered loans.

I thought I had everything figured out, but I guess I will be pulling a all-nighter to read the final rule again.

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#1500172 - 01/25/11 10:36 PM Re: New MDIA Disclosures Effective Jan 30, 2011 Dodge
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Correct me if I'm wrong. I don't think anything has changed with respect to when an ETIL is required. It's just that if it IS required, it must be the new format.
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#1500217 - 01/26/11 01:10 AM Re: New MDIA Disclosures Effective Jan 30, 2011 swiggles
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Ok, maybe you could help me out with this paragraph on page five under the Interim Rule section it states this:

Scope of § 226.18(s). TILA Section 128(b)(2)(C) applies to all transactions secured by a dwelling, other than transactions secured by timeshare plans(discussed below). The Board proposed
to expand the requirement in Section 128(b)(2)(C) to include loans secured by real property that do not include a dwelling and is now adopting that proposal. Thus, transactions secured by real property with no dwelling or other structure built thereon would be subject to the enhanced disclosures, assuming such transactions are consumer credit. Some creditors commented on the proposed expansion of the scope of the MDIA requirements, questioning its necessity. As discussed in the 2009 Closed-End Proposal, however, unimproved real property is likely to be a significant asset for most consumers,and consumers should receive the disclosures required in Section 128(b)(2)(C) before they become obligated on a loan secured by such an asset. The disclosures will alert consumers to the potential for interest rate and payment increases and help them to determine whether these risks are appropriate to their circumstances. The Board also believes that consistent disclosure requirements for all mortgage-secured, closed-end, consumer credit transactions, whether they include a dwelling or not, should ease compliance burdens for mortgage creditors.

I am new to compliance so maybe I'm reading to much into this. I just don't want to miss anything.

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#1500225 - 01/26/11 02:41 AM Re: New MDIA Disclosures Effective Jan 30, 2011 Dodge
Sheldon Hendrix Offline
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Giants, what I think you may be getting confused about is the form of disclosure to use, not IF a TIL is required. If a loan is to a consumer and for a consumer purpose, then a TIL is always required (unless non-Real Estate under $50m). Under these new rules; however, you would use the new payment summary tables instead of a "payment schedule" (number, amount, and timing of payments) on the TIL if the loan is secured by real property OR a dwelling.

So, there will be transactions that are not covered by RESPA (e.g., land only, mobile home only) where a new version of the TIL will in fact be required.

Hope this helps!

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#1500356 - 01/26/11 03:29 PM Re: New MDIA Disclosures Effective Jan 30, 2011 Sheldon Hendrix
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Originally Posted By: Compliance Rules
Originally Posted By: RR joker
QCL - the first form you mention is obviously for credit saledisclosure. Perhaps that will help some in diving into the issue further.


We are JHA/WKFS as well. There is a credit sale (X703TA) form and general fixed rate form (X703A) available in the library.


That much we figured out.
The one we need - X703A - is not in our library. From this point on it is all a foreign language. I take care of the regulatory stuff, someone else makes sure the forms are there....argh.

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#1500387 - 01/26/11 03:50 PM Re: New MDIA Disclosures Effective Jan 30, 2011 QCL
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Also, Giants...some of those loans aren't RESPA loans, so you may have situations where you only have the "Final" TIL and not an early TIL. I think from your first question, that was your question, wasn't it?
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#1500390 - 01/26/11 03:51 PM Re: New MDIA Disclosures Effective Jan 30, 2011 QCL
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Looking for help on model form H-4(F)on disclosing ARM products. Do we always have to include the middle column (maximum during first five years)? If the loan is a 7/1 ARM, that column will not be different than column 1 (intro rate & montly payment). For this product, could we just have column 1 and column 3 (maximum ever)?

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#1500438 - 01/26/11 04:17 PM Re: New MDIA Disclosures Effective Jan 30, 2011 starfish
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The preamble states that an amort ARM will have at least 3 columns if the trans has intermediate limitations on int rates. I assume "intermediate limitations" mean rate caps (floor) & periodic min/max int rate adj limitations.
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#1500584 - 01/26/11 06:09 PM Re: New MDIA Disclosures Effective Jan 30, 2011 ahou
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You need to show all three columns unless your product does not have periodic interest rate caps. Comment 2 to the OSC to section 226.18(s)(2)(i)(B)states the following.

2. Maximum interest rate during first five years—adjustable-rate mortgages and step- rate mortgages. The creditor must disclose the maximum rate that could apply during the first five years after consummation. If there are no interest rate caps other than the maximum rate required under § 226.30, then the creditor should disclose only the rate at consummation and the maximum rate. Such a table would have only two columns.
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#1500701 - 01/26/11 07:48 PM Re: New MDIA Disclosures Effective Jan 30, 2011 Reads Regs
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Our vendor is only showing two columns when disclosing a 7/1 ARM, the initial rate and the maximum rate. We do have interest rate caps on this product; however, they wouldn't take effect until the 8th year and thereafter. It doesn't make since to me why on a 7/1 ARM we would need to include the middle column? In our bank, the middle column would disclose the same information as the first column. The OSI refers to the maximum interest rate during the first five years, I guess I don't understand how this applies to a 7/1 ARM?

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#1500826 - 01/26/11 09:16 PM Re: New MDIA Disclosures Effective Jan 30, 2011 GatorsFan
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Our vendor is doing the same thing (eliminating the middle column) for a our 3/1 arm. It does have interim caps, but it reaches its maximum by the 5th year. That is our vendor's reason for eliminating the middle column. I believe we need the middle column unless there is no other cap than the maximum.
Any other opinions?

Our new TIL is also missing any information pertaining to an itemization of amount financed. This isn't an issue for RESPA loans but if it isn't a RESPA loan then we will have to remember to manually diclose. Is anyone else having this problem?

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#1500978 - 01/27/11 12:51 AM Re: New MDIA Disclosures Effective Jan 30, 2011 Sugarbaker
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[2. Maximum interest rate during first five years—adjustable-rate mortgages and step rate mortgages. The creditor must disclose the maximum rate that could apply during the first five years after consummation. If there are no interest rate caps other than the maximum rate required under § 226.30, then the creditor should disclose only the rate at consummation and the maximum rate. Such a table would have only two columns.]

Since you have no caps, you only need 2 columns.
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#1501001 - 01/27/11 04:26 AM Re: New MDIA Disclosures Effective Jan 30, 2011 ahou
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Less than a week left and it looks like we're all just hoping we got this right. Our forms vendor (WK) seems to think there will be more changes as some of this gets clarified---What is anyone doing for single pay loans? We have a fixed rate form and an "adjustable rate" form and have been told to not include any amounts in the table to just show the balloon. Also for a variable rate (non-ARM), our form has 2 columns. Intro Rate and Maximum Ever. Our rate is tied to an index and can change daily but no adjustments, so what would you put in Max Ever or is it just NA? I'm looking at 226.30 with our attorney and he's not sure either....Thank you!

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#1501015 - 01/27/11 01:29 PM Re: New MDIA Disclosures Effective Jan 30, 2011 Jan94
Dani York, CRCM Offline
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Jan--

Can't help you with the single pays. But for VRLs, we are putting the note rate in the Intro column, using the note term for the "for first x months", putting the highest interest payment due during the note term (31 days). For the Max Ever column, we are using our rate ceiling for the interest rate (the state max), the highest interest payment at that rate (31 days at the max rate), and trying to decide between disclosing the "as early as x" the day after the note or the first payment date. I have heard 2 different things on what put in as principle in that column (the balloon payment or leave it blank), so I'm still working on that part too.
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#1501016 - 01/27/11 01:30 PM Re: New MDIA Disclosures Effective Jan 30, 2011 Dani York, CRCM
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FINALLY ABOVE the gnat line
At least you've had yours to look at for a while - we just received our update yesterday!
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#1501020 - 01/27/11 01:35 PM Re: New MDIA Disclosures Effective Jan 30, 2011 ahou
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Originally Posted By: ahou
[2. Maximum interest rate during first five years—adjustable-rate mortgages and step rate mortgages. The creditor must disclose the maximum rate that could apply during the first five years after consummation. If there are no interest rate caps other than the maximum rate required under § 226.30, then the creditor should disclose only the rate at consummation and the maximum rate. Such a table would have only two columns.]

Since you have no caps, you only need 2 columns.


Thanks ahou! We do have other caps though; however, the rate it will reach its maximum by the five year point. The commentary states if there are no other caps then two columns are permitted. It still seems to me that we should have a middle column?
Am I misreading?

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#1501039 - 01/27/11 02:13 PM Re: New MDIA Disclosures Effective Jan 30, 2011 waldensouth
QCL Offline
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Originally Posted By: waldensouth
At least you've had yours to look at for a while - we just received our update yesterday!

You are not alone.

One more question - is the property insurance information new?
"Property Insurance. Property insurance may be obtained from anyone that is acceptable to Lender. If property insurance is
obtained from or through Lender, the cost is $BLANK for a BLANK term of coverage."

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#1501040 - 01/27/11 02:14 PM Re: New MDIA Disclosures Effective Jan 30, 2011 QCL
waldensouth Offline
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FINALLY ABOVE the gnat line
That's always been on our TILs. If the customer purchases property insurance from the bank, then its a finance charge.
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#1501052 - 01/27/11 02:31 PM Re: New MDIA Disclosures Effective Jan 30, 2011 waldensouth
RR Joker Offline
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agree, it's nothing new.

On the single-pay loan, I agree you'll only have the balloon disclosure complete, unless you are requiring periodic interest payments.
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