I attended the Lending Compliance Roundup Seminar in Tulsa on March I. I understand that the easiest way to comply with the Risk Based Pricing Notice was to give the two pages from the credit bureau report- Your Credit Score and the Price You Pay for Credit. If we do give The Risk Based Pricing Notice stating that the interest rate would be effected, then must it be given to only the people it effects and not every customer?
I have the following loan example: Construction/Permanent for primary residence. If the loan is approved with an 18 mo construction variable rate AND a Fixed rate(Undetermined) permanent rate for 7 yr/ 25 yr amortization. With the "new" guidelines how does the Early Truth In Lending calculate for the payment schedules in the TIL box. The first 18 mos are Interest Only and I have no way of knowing the interest rate during the permanent phase. Which term (Construction or permanent)am I disclosing?
I want to do a reduction of principal balance and a recast of payments keeping the same interest rate on a 1-4 sf residence. Is a modification appropriate and will it trigger RESPA?
What loans are disclosable and require the Interest Rate and Payment Summary Table?
If we were to modify a residential real estate loan for the sole purpose of reducing the interest rate and we were to charge a fee for doing so, say $100, would this trigger a truth-in-lending disclosure?
If a customer chooses to float their interest rate and it is set 7 days prior to closing, if it increases from application do we need to prepare a revised GFE? I know if the APR is over/under tolerance of .125% we would redisclose that.
Can a claw back provision be included in a workout document? For example: can we collect a low interest rate to match cash flow, but when the property sells, claw back the market rate difference so that there is no loss to the bank?
On the GFE, the lender discloses an origination charge that the borrower will have to pay. However, before closing, the bank decides to cover this fee for the borrower. Would this credit from the lender go in the 200 series on page one of the HUD, or would it be shown as a credit for the specific interest rate chosen on line 802? My concern is that we are not giving the credit based on the interest rate chosen, simply as a courtesy to the customer.
Our bank will occasionally give a lender credit to offset Origination Fees/Discount Points. In this case, would that lender credit be calculated into the APR, thus ultimately lowering the APR?
For a construction loan with construction phase terms of 6.19% for eight months interest only, with balloon payment at maturity with a final take out of a 3/3 thirty year ARM, what should be on the initial GFE, construction HUD-1, and at take out closing? Should these now be treated as two separate and distinct loans to insure tranparency, or can the GFE include the construction terms and the take out terms that will occur eight monthes later?