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#239277 - 08/31/04 09:05 PM HUD Completed by Attorney
La. Lady Offline
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La. Lady
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Are loan officers responsible for insuring that the HUD form completed by an attorney is correct?

Thanks
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Lending Compliance
#239278 - 08/31/04 09:06 PM Re: HUD Completed by Attorney
David Dickinson Offline
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David Dickinson
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Central City, NE
Yes. In short, if you advance money, then are responsible for all disclosures.
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#239279 - 08/31/04 09:28 PM Re: HUD Completed by Attorney
Dan Persfull Offline
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Dan Persfull
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Bloomington, IN
I agree. The lending institution is responsible for the accuracy of all required loan documents.
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#239280 - 08/31/04 09:45 PM Re: HUD Completed by Attorney
SMQ, CRCM Offline
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Between the lines
Ditto, this might be helpful for your attorneys.
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#239281 - 09/01/04 12:20 PM Re: HUD Completed by Attorney
waldensouth Offline
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I do hate to go against the flow here, but we have been told in training session at the ABA NRCC and by our regulators that the person who completes the HUD is responsible for completing it correctly. From our regulators' perspective, our responsibility is to let the attorney know what is wrong with the way they completed it, tell them how it must be completed, and if the attorney fails to change his/her "evil ways" then we are to stop allowing them to close loans for us. Most of our attorneys have cooperated, however we have stopped doing business with a few. So far, the regulators have not penalized us for the attorney's errors.
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#239282 - 09/01/04 12:32 PM Re: HUD Completed by Attorney
upstateNY Offline
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Joined: Apr 2003
Posts: 933
New York State
Quote:

I do hate to go against the flow here, but we have been told in training session at the ABA NRCC and by our regulators that the person who completes the HUD is responsible for completing it correctly. From our regulators' perspective, our responsibility is to let the attorney know what is wrong with the way they completed it, tell them how it must be completed, and if the attorney fails to change his/her "evil ways" then we are to stop allowing them to close loans for us. Most of our attorneys have cooperated, however we have stopped doing business with a few. So far, the regulators have not penalized us for the attorney's errors.



We have had problems with HUD's and attorneys for several years. We are a national bank, OCC regulated. It has been made very clear to us that we are ultimately responsible to ensure that the HUDS are prepared correctly, regardless of who is doing the preparing. The onus falls to us, the bank.

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#239283 - 09/01/04 01:16 PM Re: HUD Completed by Attorney
waldensouth Offline
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We are regulated by the FDIC and we have never been written up for improperly attorney prepared HUDs - bank prepared YES. In our area, the attorney works for the customer and is chosen by the customer. They don't work for the bank and are not generally answerable to the bank except for the promise of future business. We either add them to our list of recommended attorneys or not. If you may recall, the Georgia Fair Lending Act REQUIRED us to allow customers to choose their own attorney. Absent an agency relationship, how can the regulators legally hold the bank responsible for the actions of an independent 3rd party?

Granted, we should always to strive to communicate the appropriate way to complete these forms to the attorneys and we have our loan officers order a copy of the HUD in advance of loan closing to determine if it is correct and in agreement with our note. When we have our choice of attorneys - we choose those who do it right.
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"Once you learn to read, you will be forever free."

- Frederick Douglass




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#239284 - 09/01/04 01:30 PM Re: HUD Completed by Attorney
David Dickinson Offline
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Joined: Nov 2000
Posts: 18,762
Central City, NE
This sounds like a local office policy. I was a FDIC Examiner and we cited banks if the Settlement Statement (SS) was not correct - no matter who prepared it. The logic (or lack thereof) is that you must have a properly prepared SS before YOU advanced money. If you advance the loan without a proper SS, you are responsible. You could have always prepared your own.
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#239285 - 09/01/04 02:42 PM Re: HUD Completed by Attorney
waldensouth Offline
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Well, either the FDIC changed it's mind or its a Regional policy - our banks are served by field offices in SC,FL,GA,and AL. Our 1 national bank has not been cited for this either. They do look to see if we're sending the attorney notice of the error. It was an attorney who taught the course on RESPA at the ABA NRCC a couple of years ago who made the statement - trust me it was a Hallelujah moment for those of us in the room. I'll see if I can remember which conference and the name of that female attorney.
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"Once you learn to read, you will be forever free."

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#239286 - 09/01/04 03:48 PM Re: HUD Completed by Attorney
upstateNY Offline
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Posts: 933
New York State
Lucky you Walden. We're get criticized all the time. And let's face it, all the training in the world can't keep the attorney's on track.

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#239287 - 09/01/04 06:13 PM Re: HUD Completed by Attorney
waldensouth Offline
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waldensouth
Joined: Nov 2001
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Well, Go 4 it, since it appears to be a regional issue, you may wish to contact your regulator and ask them how they treat this issue. We do work with our attorneys and try to educate them in the event our luck runs out.
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"Once you learn to read, you will be forever free."

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