If we have a loan for $7 million with collateral being commercial properties valued at $3 million, UCCs, and assignment of publication rights, what should our Lender's Title Policy coverage be? These commercial properties are in PA & NY. We have requested a Lender's Policy for $7 million, however, the attorney is stating that he can only insure up to the "fair market value" which I've never heard in my 20 years of banking. So what is the rule on how much of a Lender's Policy can we get?
Our bank was told that we must include an amount for title insurance premium on the GFE and HUD even though we do not require it. Is this true?
If no list of providers was provided with the GFE, do the fees that were charged for the Lender and Owner Title Insurance have to be included on the 10% tolerance table on the HUD?
We have read in the Federal Register that the amounts to be inserted in the comparison chart on the HUD form are only those for services that were purchased or provided as part of the transaction. We disclose on purchase transactions owner's title Insurance, which is rarely purchased. Does this make the GFE and HUD #'s not match?
What is the difference between a pre-approval and a pre-qualify for a home loan?
Will you explain the difference between a prequalification and a preapproval for HMDA, RESPA and OCC purposes?
Block 4 requires the lender to disclose the lender’s portion of the title insurance plus any other title services fee charged to the borrower. Block 5 requires the lender to quote the owner’s title insurance premium. These are not itemized for the GFE purposes; however, some of the fees need to be broken out for TIL purposes in order to get them to calculate in the APR. One title company we deal with indicated to us that owner’s title insurance premium equals the total premium (required for both owner’s and lender’s) minus the premium (on their rate sheets) for the lender’s portion of the premium. Another states that the owner’s portion is the entire premium and that they issue a simultaneous lender’s policy for $25.00. Based on from whom we get our quote, we will be disclosing differently on certain files; however, the ultimate “total cost” is the same. Is this okay?
I have a question regarding the three day wait after giving a customer a TIL. Our customer applied, and we had her sign all early docs. The only change in fees from the early docs is a $10 increase in Title Insurance Premium. Do we need to issue a new GF/TIL and wait an additional three days, or is there a certain allowance we have for situations like that? Also, once we receive the Final HUD from the Title Co., if fees are changed, do we have to reissue and wait an additional three days?
The Q&As below are those that were added by HUD December 30, 2009
GFE - Written list of providers - Page 12
A borrower has requested a copy of the mortgagee title policy. No owner’s policy has been purchased. Is there a risk to provide the "lenders" copy to the borrower, or restrictions to provide? Is this a common practice? This is our first request of this nature.