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#2198815 - 11/20/18 08:41 PM ADDITIONAL COLLATERAL ON A TRID LOAN
Carol Hopper Offline
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Carol Hopper
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Central Missouri
Can someone help with the following:
a) does additional collateral need to show up on a LE, and
b) if so - where we would disclose additional collateral on a TRID loan. We are taking an assignment of life insurance on a home construction loan. Shouldn't that assignment show up somewhere on the disclosures. We use laser pro and it is not showing anywhere on our Loan estimate. I thought it would print on an addendum, but it is not.
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TRID - TILA/RESPA Integrated Disclosures Rule
#2198820 - 11/20/18 09:08 PM Re: ADDITIONAL COLLATERAL ON A TRID LOAN Carol Hopper
raitchjay Online
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If the additional collateral is real estate, then yes it needs to be on the LE and CD (can be on an addendum, if necessary). Collateral that is NOT real estate doesn't (and shouldn't) show up on either.
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#2198826 - 11/20/18 09:21 PM Re: ADDITIONAL COLLATERAL ON A TRID LOAN Carol Hopper
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(6) Property. The address including the zip code of the property that secures or will secure the transaction, or if the address is unavailable, the location of such property including a zip code, labeled “Property.”

and from the OSC:

3. Multiple properties. Where more than one property secures the credit transaction, §1026.37(a)(6) requires disclosure of all properties. If the addresses of all properties securing the transaction do not fit in the space allocated on the Loan Estimate, an additional page with that information with respect to real properties may be appended to the end of the form.

Notice "properties", not "pieces of collateral" is used.
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#2198827 - 11/20/18 09:25 PM Re: ADDITIONAL COLLATERAL ON A TRID LOAN Carol Hopper
RR Joker Offline
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I'm guilty of adding non RE collateral in that section because it seems deceitful otherwise. However, you can potentially add it to your note, regardless...along with a security agreement. Chances are your LOS isn't set up to automatically do this. If I have collateral other than Manufactured home personal property [supported on my LOS] I add it to the legal description on the note and perfect it outside of the system.
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#2198829 - 11/20/18 09:34 PM Re: ADDITIONAL COLLATERAL ON A TRID LOAN Carol Hopper
raitchjay Online
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It doesn't seem deceitful to me....it says "property" and is followed by an address. I think in the context of TRID disclosures (known to be real estate transactions), it isn't deceitful at all....but maybe that's just me.
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#2198830 - 11/20/18 09:36 PM Re: ADDITIONAL COLLATERAL ON A TRID LOAN Carol Hopper
raitchjay Online
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And if it is, tell them to call the CFPB (or whatever they're called now...they'll always be the CFPB to me)......it isn't our disclosure...it's theirs.
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#2198834 - 11/20/18 10:09 PM Re: ADDITIONAL COLLATERAL ON A TRID LOAN Carol Hopper
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Thank you everyone. The old banker in me was taught a long time ago when REG Z applies to disclose the collateral. That is why I was having a hard time with this.
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#2198847 - 11/21/18 09:02 AM Re: ADDITIONAL COLLATERAL ON A TRID LOAN Carol Hopper
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On the LE:

2. Personal property. Where personal property also secures the credit transaction, a description of that property may be disclosed, at the creditor’s option pursuant to § 1026.37(a)(6), if a description fits in the space provided on form H-24 for the disclosure required by § 1026.37(a)(6). An additional page may not be appended to the form to disclose a description of personal property.

On the CD:

38(a)(3)(vi) Property.

1. Alternative property. For guidance on disclosing the location of a property for which an address is unavailable, see the commentary to § 1026.37(a)(6). Where personal property also secures the credit transaction, a description of that property may be disclosed, at the creditor’s option, pursuant to § 1026.38(a)(3)(vi). If the form does not provide enough space to disclose a description of personal property under § 1026.38(a)(3)(vi), at the creditor’s option an additional page may be used and appended to the end of the form provided that the creditor complies with the requirements of § 1026.38(t)(3).
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#2198858 - 11/21/18 02:29 PM Re: ADDITIONAL COLLATERAL ON A TRID LOAN Carol Hopper
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My subconscious must have recalled this because I'm pretty sure I've always done it, even though it doesn't happen all that often [except chattel MH's...those happen more frequently. THANKS, Randy!
Last edited by RR Joker; 11/21/18 02:30 PM. Reason: added to post
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#2198860 - 11/21/18 02:34 PM Re: ADDITIONAL COLLATERAL ON A TRID LOAN Carol Hopper
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Thanks Randy.....either didn't know that or had forgotten it. My apologies for my earlier statements.
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