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#2003605 - 03/24/15 04:10 PM Relocks and Extensions - RESPA
Joe L. Offline
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Joined: Mar 2015
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We currently do not redisclose the borrower if the rate is relocked, but do when an rate lock extension is made. From my understanding, based on several topics on this subject, it appears that we are required to disclose whenever a rate lock happens as the Important Dates section of the GFE would change.

I remember seeing a post where Dan Persfull cited some CFPB meetings where they affirmed this definition of the law. Any other input on whether a redisclosure is required on a relock?

Thanks.

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#2003613 - 03/24/15 04:16 PM Re: Relocks and Extensions - RESPA Joe L.
Truffle Royale Offline

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What's the difference between a relock and an extension that makes you feel like you don't have to redisclose for one but you do for the other?

P.8 of the FAQ 19) speaks to redisclosing on a rate lock. Tons of posts in this forum and the Lending forum on this topic. Try doing a google search for 'redisclosing GFE rate lock BankersOnline'

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#2003648 - 03/24/15 05:03 PM Re: Relocks and Extensions - RESPA Joe L.
Dan Persfull Offline
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Dan Persfull
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Bloomington, IN
We currently do not re-disclose the borrower if the rate is relocked, but do when an rate lock extension is made.

The requirement to issue a revised GFE when the rate is locked is when a rate lock agreement is executed between the financial institution and the consumer, not the financial institution and their investor.

Each time you lock or re-lock/extend a lock agreement between you and the consumer you are required to issue a revised GFE.
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The opinions expressed are mine and they are not to be taken as legal advice.

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#2003654 - 03/24/15 05:12 PM Re: Relocks and Extensions - RESPA Joe L.
Joe L. Offline
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Joined: Mar 2015
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I described our process as wrong; we do not disclose on rate lock extensions, but do on re-locks because it is essentially a "float to lock". Based on your response, the bureau would define that there is no difference between re-locks and lock extensions and therefore redisclosures are mandatory, correct?
I've reviewed the HUD FAQ 19 and it appears they are alluding to a "float to lock" scenario, not a rate lock extension.

I'll continue to review topics already posted on BankersOnline so I can gain a full understanding. The main objective here is to ensure we are issuing redisclosures appropriately.

Appreciate your response.

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#2003662 - 03/24/15 05:17 PM Re: Relocks and Extensions - RESPA Joe L.
Joe L. Offline
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Joined: Mar 2015
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Dan, that clears it up well for me. At this time, we are simply relocking the rate with the investor or extending the lock and not changing anything (charging the borrower) that would be indicated on the GFE, besides the Important Dates.

My question is whether or not the change in Important Dates, exclusively, warrants a revised GFE?
Last edited by Joe Laidlaw; 03/24/15 05:18 PM.
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#2003669 - 03/24/15 05:26 PM Re: Relocks and Extensions - RESPA Joe L.
Truffle Royale Offline

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Originally Posted By: Joe Laidlaw
My question is whether or not the change in Important Dates, exclusively, warrants a revised GFE?
Yes. That's exactly why the GFE must be redisclosed. Otherwise, the borrower does not have the correct information regarding timing.
HUD must have figured the money wasn't as important as missing the day you must close by. crazy

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#2003675 - 03/24/15 05:41 PM Re: Relocks and Extensions - RESPA Joe L.
Dan Persfull Offline
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Dan Persfull
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Bloomington, IN
Joe - if the re-lock or lock extension is between you and your investor then you would not issue a revised GFE.

But as TR states the purpose of issuing a revised GFE when the rate is locked/re-locked/extended with the consumer is to inform them how long the "new" rate is valid and by what date they must go to closing to receive that rate.
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The opinions expressed are mine and they are not to be taken as legal advice.

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