Closing Disclosure - Settlement Agent

Posted By: FL Compl Officer

Closing Disclosure - Settlement Agent - 09/02/15 02:46 PM

We (bank) close some of our 2nd mortgage residential loans in house - should we list our information in the Settlement Agent field on page 5 of the closing disclosure? I'm thinking we should.
Posted By: Jerod Moyer

Re: Closing Disclosure - Settlement Agent - 09/02/15 02:54 PM

That is what the CFPB told us when we asked them.
Posted By: bwj8

Re: Closing Disclosure - Settlement Agent - 09/02/15 02:57 PM

Just curious, would any of the info you put in the Settlement Agent column differ from what is in the Lender column?
Posted By: Jerod Moyer

Re: Closing Disclosure - Settlement Agent - 09/02/15 02:57 PM

It could if different persons and/or locations are involved.
Posted By: FL Compl Officer

Re: Closing Disclosure - Settlement Agent - 09/02/15 02:58 PM

Great. Thank you!
Posted By: bwj8

Re: Closing Disclosure - Settlement Agent - 09/02/15 03:05 PM

So would you also put the Lender's name in the Settlement Agent field at the top of page 1 of the Closing Disclosure?
Posted By: rlcarey

Re: Closing Disclosure - Settlement Agent - 09/02/15 03:09 PM

I think the CFPB needs to re-read their own regulation. There is no "agent" involved if a creditor is closing their own loan:

38(r) Contact information.

1. Each person to be identified. Form H-25 of appendix H to this part includes the contact information required to be disclosed under § 1026.38(r) generally in a five-column tabular format (i.e., there are columns from left to right that disclose the contact information for the creditor, mortgage broker, consumer’s real estate broker, seller’s real estate broker, and settlement agent). Columns are left blank where no such person is participating in the transaction
Posted By: Jerod Moyer

Re: Closing Disclosure - Settlement Agent - 09/02/15 05:04 PM

Randy, I don't see where it says to omit the settlement agent if the lender is acting as the settlement agent? Which is what we asked the the CFPB. Their response was that if the lender acting as the creditor is also the settlement agent, list them in both columns. It's not that there isn't someone acting as the settlement agent; rather, it may be a dual role.
Posted By: rlcarey

Re: Closing Disclosure - Settlement Agent - 09/03/15 01:28 AM

So why does the settlement agent step into the shoes of the creditor if they are not separate entities?? If a creditor is also a settlement agent, why address it in this manner??

1026.38(f)(1)(v) Settlement agent. A settlement agent may provide a consumer with the disclosures required under paragraph (f)(1)(i) of this section, provided the settlement agent complies with all relevant requirements of this paragraph (f). The creditor shall ensure that such disclosures are provided in accordance with all requirements of this paragraph (f). Disclosures provided by a settlement agent in accordance with the requirements of this paragraph (f) satisfy the creditor's obligation under this paragraph (f).
Posted By: JobSecurity

Re: Closing Disclosure - Settlement Agent - 07/18/16 03:29 PM

Researching this today. Has there been any clarification on this? There seems to be two different thoughts here. Thanks!
Posted By: MScarn6942

Re: Closing Disclosure - Settlement Agent - 07/22/16 04:47 PM

I'm researching today, too... anyone have any additional info? Our LOS for some reason won't let us put a settlement agent name one one we're closing so I'm seeing if we can just leave it out entirely since we're the creditor and settlement agent.
Posted By: John Burnett

Re: Closing Disclosure - Settlement Agent - 07/22/16 05:09 PM

If you aren't using a settlement agent, you don't disclose one. Put another way, you can't be your own agent.
Posted By: Truffle Royale

Re: Closing Disclosure - Settlement Agent - 07/22/16 06:12 PM

John, isn't that in contradiction to the answer Jarrod got from the CFPB and outlined above?
Posted By: John Burnett

Re: Closing Disclosure - Settlement Agent - 07/22/16 07:02 PM

Yes, TR, it is. But that doesn't mean that the Bureau's answer was correct.
Posted By: rlcarey

Re: Closing Disclosure - Settlement Agent - 07/22/16 07:23 PM

Another one for the (ahem) July proposal smile
Posted By: Docs

Re: Closing Disclosure - Settlement Agent - 07/22/16 07:31 PM

Are we having fun, yet?

=^]
Posted By: MScarn6942

Re: Closing Disclosure - Settlement Agent - 07/22/16 07:43 PM

Well that's promising! I'm glad the Bureau had everything lined up for when all of this mess came out... Thanks to all of you for your help.
Posted By: NE Wx Forecast - Frosty

Re: Closing Disclosure - Settlement Agent - 10/06/16 05:44 PM

I'm wit Randy, but I like Jerod, so don't get mad at me. The context of the cite by Randy is that if there is someone other than the bank closing the loan, then list them as the settlement agent. Clearly a case of (another case) of poorly written rulemaking. To list the bank 2x is redundant is quite frankly insulting to me as a consumer. Fish on.
Posted By: John Burnett

Re: Closing Disclosure - Settlement Agent - 10/07/16 06:20 PM

I've pored over the regulation. In 1026.19(f)(4)(iv) there is this phrase -- "If the creditor is not the settlement agent." It made it clear to me that creditor and settlement agent are two separate roles in the settlement process. In some transactions (often refinancings and home equity loans), the creditor takes on the role of settlement agent, that doesn't negate the role of settlement agent.

I believe that the Bureau's opinion (which is not addressed in the proposed amendments as far as I can see) that Jerrod alluded to makes sense. And yes, that means I've done a "180" on the question. Not first change of mind on TRID, for sure.
Posted By: MScarn6942

Re: Closing Disclosure - Settlement Agent - 11/01/16 02:52 PM

Reviving this... is it settled that if the bank is acting as settlement agent that they're to be listed as such?
Posted By: John Burnett

Re: Closing Disclosure - Settlement Agent - 11/01/16 07:45 PM

Yes, I think it is, as much as I may have argued otherwise. I've been convinced that even when the lender does the closing, there is a settlement agent (the lender).
Posted By: John Burnett

Re: Closing Disclosure - Settlement Agent - 09/12/17 02:22 PM

And, now that I have submitted the question to the Bureau (early September 2017) and received a call from an attorney there who has been involved in this arena for quite a while, I'm going back to my earlier opinion (and the one that Randy espoused above).

While the regulation doesn't say you can't identify the lender in the "settlement agent" column, it also doesn't say you can or should. In some states, a settlement agent must be an attorney, and there can be repercussions if the lender information is in that column. So, I am now back to my old opinion that if the lender doesn't use a settlement agent, it doesn't make an entry in the settlement agent column.

However, unless the column is removed or replaced with an entry for a different contact (e.g., if there's more than one seller's real estate agent or more than one mortgage broker), don't remove the "Settlement Agent" heading.
Posted By: TwilaK

Re: Closing Disclosure - Settlement Agent - 10/26/17 02:38 PM

I appreciate your and rlcarey's research and diligence related to this question. I am needing to respond to an outside compliance review company as to why we are not listing the Bank in this filed. This thread supports my interpretation of the regulation for completion of the closing disclosure.
Posted By: rlcarey

Re: Closing Disclosure - Settlement Agent - 10/26/17 03:29 PM

Send the question to the CFPB. Document your answer for any further auditor questions.

https://reginquiries.consumerfinance.gov/
Posted By: John Burnett

Re: Closing Disclosure - Settlement Agent - 10/27/17 08:34 PM

With any luck, the same attorney I talked with will respond and give you a consistent answer.