Our bank has a mortgage subsidiary.

Sometimes loans don't meet their investors' secondary market requirements. In those cases, the bank would like to be able to approve the loan, and have it close in the name of the mortgage subsidiary, with the bank itself as the investor/purchaser.

Is that a "forward commitment"?

The bank is a small creditor and is exempt from escrow requirements for HPMLs.

The mortgage division is not exempt; it closes only 1,200 loans per year, but its investor/purchasers are not exempt, so the mortgage division routinely escrows for its customers as per its investor requirements.

The question is: If the mortgage division is NOT exempt, can loans that they sell us to BE exempt, because we are exempt?

bump

Yes, as long as the bank is really exempt considering .35(b)(2)(iii)(A),(B), and (C).