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#2045706 - 10/22/15 07:19 PM
Re: New flood escrowing requirement
complynewbie13
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Platinum Poster
Joined: Feb 2003
Posts: 883
Big Sky Country
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I know, crazy! I had pulled up the section-by-section analysis and was awaiting a verbatim reading of that portion (since they tend to just read everything anyway  ) and was totally blown away by the answer given! We'll see how everything shakes out!
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Me, Type A? Maybe - I'm not done analyzing it yet.
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#2045787 - 10/22/15 09:56 PM
Re: New flood escrowing requirement
complynewbie13
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Platinum Poster
Joined: Feb 2003
Posts: 883
Big Sky Country
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If you only escrowed for HPMLs, (with everything else voluntary) you'd be able to keep the exemption. However, since you require escrows on loans over 80% LTV, you lose the exemption.  Sorry.
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Me, Type A? Maybe - I'm not done analyzing it yet.
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#2046566 - 10/27/15 11:19 PM
Re: New flood escrowing requirement
complynewbie13
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Platinum Poster
Joined: Sep 2003
Posts: 730
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Sorry to keep beating this poor horse, but I'm confused (surprise)! Here is our situation: We fit the SLE definition. We used to have voluntary escrow accounts prior to HPML rules. But we didn't understand the SLE exemption and have been escrowing for HPML since it went into effect. We thought we had to continue to require escrows on HPML because we did so after it went into effect. So can we use the exemption and not escrow???
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#2046926 - 10/29/15 03:07 PM
Re: New flood escrowing requirement
complynewbie13
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Platinum Poster
Joined: Sep 2003
Posts: 730
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We never required escrows until the HPML provision. They were voluntary if the customer wanted them. Then we started requiring them because of the HPML provisions. But I thought because we did require them and didn't use the exemption we lose the exemption???
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#2048230 - 11/05/15 04:12 PM
Re: New flood escrowing requirement
complynewbie13
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Platinum Poster
Joined: Sep 2003
Posts: 730
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Yes, that is all we had ever done prior to 2012. They were voluntary and they signed a document indicating whether they would like us to escrow for them. They checked a box, they would, or they would not.
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#2048256 - 11/05/15 05:10 PM
Re: New flood escrowing requirement
complynewbie13
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Member
Joined: Jan 2013
Posts: 55
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If we have required the escrow of Private Mortgage Insurance premiums on a loan (no taxes or flood) we do not qualify for the exemption? PMI must be cancelled at 78% so is that requiring it for the life of the loan? I guess if they were always behind on their loan the escrow could continue to be on the loan past the 78%.
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#2048320 - 11/05/15 07:49 PM
Re: New flood escrowing requirement
complynewbie13
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Member
Joined: Jan 2013
Posts: 55
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Thank you David for the help.
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#2050712 - 11/20/15 05:05 PM
Re: New flood escrowing requirement
complynewbie13
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Platinum Poster
Joined: Oct 2009
Posts: 604
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My bank believes we are not going to take the exemption and go ahead and escrow the flood loans starting January 1st. We think it will be confusing for customers to only escrow the flood part. We would like to require that since we will do the flood, we do everything-it just seems easier and cleaner for everyone. Can we require the whole package? I have not dug into that part yet. Just wondering what others are thinking.
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#2050885 - 11/23/15 02:48 PM
Re: New flood escrowing requirement
complynewbie13
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Platinum Poster
Joined: Oct 2009
Posts: 604
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#2051014 - 11/23/15 08:15 PM
Re: New flood escrowing requirement
complynewbie13
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Power Poster
Joined: Jan 2003
Posts: 3,070
Oklahoma
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Wanted to add a question to this thread: We have a customer for which we had to force place flood. This customer currently does not escrow insurance and taxes. Am I right that we'd add this forced placed insurance into her escrow bucket, into the negative, and run a new escrow to adjust her payments for this? I just wanted to verify. We rarely make new mortgage loans and sometimes servicing an existing portfolio makes me quadruple question myself.
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Just working here until I get my letter from Hogwarts.
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#2079315 - 05/19/16 02:23 PM
Re: New flood escrowing requirement
David Dickinson
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Power Poster
Joined: Jan 2003
Posts: 3,070
Oklahoma
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Thank you Rebekah. I was not able to listen to the webinar, but 2 of our consultants did and they confirm your analysis.
I'm happy to hear:
2. Next, the question was asked whether or not a creditor that escrows at the behest of a 3rd party and/or for the secondary market will lose the SLE. This answer got interesting. An FDIC representative answered, and said:
- If the creditor sells the loan AND transfers the servicing, then it can keep the SLE.
- If the creditor sells the loan but KEEPS the servicing, then it loses the SLE. (!) shocked
What's strange about this is contradiction of the section-by-section analysis of the Final Rule. On page 49, it states:
With respect to the situation involving a third party, the Agencies believe that under the FDPA and the Agencies’ regulations, it is irrelevant why the lender is requiring the escrow so long as there is a policy of uniformly or consistently requiring borrowers to escrow.
So the phone webinar overrides what was printed in the final rule? I like it, but it would be great if they put this in writing.
#3 is a shocker. Again, are we to take their verbal word as the truth even thought it contradicts a FFIEC FAQ? Is there any new discussion/info about a bank selling a mortgage loan but keeping the servicing? We don't routinely/uniformly require escrows for our mortgage portfolio BUT we have 7 loans that we sold back in 2004 and we retained the servicing. That 3rd party requires escrow. Do I not qualify for small bank exemption over 7 loans?
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Just working here until I get my letter from Hogwarts.
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