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Compliance Update for the week ending July 11,2008
Revised Idaho Deed of Trust posted on the Fannie Mae and Freddie Mac website. Revisions to tagline and text in paragraph 22 and 25.
Compliance Update for the week ending May 30,2008
FHA has released a new form available on HUDCLIPS the 92900lt, this replaces the 92900ws and 92900pur. This is the FHA Loan Underwriting and Transmittal summary.It is mandatory since October but can be used now also.
There is a new minor revision to FHA/VA addendum to the URLA HUD 92900a/VA26-1802a, with the same use date and is also posted on HUDCLIPS.
A few OMB date only update also posted for the 92051, 92300 and 92005.
Compliance Update for the week ending May 23,2008
Mississippi:Changes in the recording margins of the Mississippi form. The margins are 1 inch on all 4 sides, except 3 inch on top of first page. Preparers name, address and phone number must appear on the form along with a return address after recording. These changes are not mandatory until June 2009.
Compliance Update for the week ending May 2,2008
The IRS form 4506T was revised with minor changes in language and address changes on second page.
Compliance Update for the week ending April 11,2008
Pennsylvania:Fannie Mae and Freddie Mac required new state specific notes for Pennsylvania to incorporate the "seal" language.They have reversed this position and the changes made to the mortgages and the authorized changes for all the notes have been rescinded.No deadline was announced.If this requirement is continued for government and second mortgage notes,then those should be reversed too.
Compliance Update for the week ending April 4,2008
MORTGAGEE LETTER 2008-08 - Home Equity Conversion Mortgages - Fixed Interest Rate:This Mortgagee Letter provides guidance to FHA-approved lenders choosing to offer a fixed interest rate Home Equity Conversion Mortgage (HECM). To read more: Click Here
MORTGAGEE LETTER 2008-09 - Second Appraisal Requirements/Limits on Cash-Out Refinances:Specifically, for mortgage amounts that will exceed the January 1, 2008 conforming limit of $417,000, FHA is establishing a second appraisal requirement for loans on properties in declining areas, and limiting the loan-to-value for cash-out refinances. These requirements are further described below and are effective for all mortgages with FHA case number assignments made on or after the date of this mortgagee letter.To read more: Click Here
Compliance Update for the week ending March 28,2008
The OMB date of 11/30/2008 in the HUD 92561 Hotel and Transient form posted in January to HUDCLIPS was incorrectly dated. The correct date is 11/30/2010 on the form posted in March.
The New Mexico Security Instrument posted in Freddie Mac website in Januray changing it from a mortgage to a Deed of Trust had missed some language and the definition for Trustee. The revised form is posted on the Freddie Mac website as on March'08.The change should be made within 6 months.
An authorised change to the Massachusetts mortgage on the Freddie Mac website requires you to add Broker as a "C-1" definition under lender if a broker originated the mortgage.
Compliance Update for the week ending March 7,2008
Temporary Loan Limit Increase for FHA:This Mortgagee Letter provides information on Federal Housing Administration single family mortgage limits as a result of enactment of the Economic Stimulus Act of 2008 ("the Act"). These limits are effective for mortgages endorsed for insurance on or after the date of this mortgagee letter and remain in effect for those mortgages for which the mortgagee has issued credit approval for the borrower on or before December 31, 2008.To read more: Click Here
Compliance Update for the week ending February 29,2008
FHA has posted new Model Notes on HUDCLIPS. The only change observed was in the instructions and that the abbrevation "U.S:. in front of the $ sign for monthly payment amount - Section (c).
FHA also updated their 92900.B for the paperwork reduction expiration date only.Revision available on HUDCLIPS.
New Mexico:Freddie Mac posted a New Mexico Deed of Trust form as a security instrument.Fannie Mae has not yet posted it but it should be the same as Freddie Mac.
Compliance Update for the week ending February 1,2008
Fannie Mae has updated some of the forms such as the California Deed of Trust (Form 3005SF),Indiana Instructions to Form 3015,North Carolina Instructions to Form 3034,New York Instructions to Form 3033,Pennsylvania Instructions to Form 3039 etc.The following forms can be downloaded at the following link. Click Here
Maine:The State of Maine updated its new Tangible Net Benefit disclosure.The updated form can be found on State of Maine website or search the net for Joint Advisory Ruling 114 Maine.
California:The State of California updated the following DRE forms: the DRE form RE882, Mortgage Loan Disclosure Statement (Borrower) ; form RE883, Mortgage Loan Disclosure Statement/Good Faith Estimate ; and form RE885 Mortgage Loan Disclosure Statement/Good Faith Estimate Nontraditional Mortgage Product (VMP766NCA).The CA DRE approved these changes on January 18, 2008 and can be found on the CA DRE website. Click Here
Compliance Update for the week ending January 25,2008
In the HUDCLIPS website, some very common forms such as 92900A, 92900B, 92900WS, 92900PUR, 92700, 92844, 92561 have been updated for the OMB expiration dates.The were posted on January 16,2008.
Compliance Update for the week ending January 4,2008
Texas :There are changes in the TX affidavit form 3185 from Fannie Mae and the correct version of the form has been posted by Freddie Mac.
North Carolina :The Broker name must appear on the first page of the Security Instrument whenever a wholesale lender is closing in their name.This is effective from April 2008.Freddie Mac would like to see this information stated as a Definintion C-1.More details can be found on the Freddie Form update page.
Massachusetts :The last two disclosures "Important Notice of Loan Terms" one for brokers and one for bankers required in the fall are now obsolete.The MA AG still requires all disclosures when needed but the previously prescribed format is no longer necessary. This is according to the latest amendment of 900 CMR 8.05
Compliance Update for the week ending December 14,2007
Maine:According to the new law in Maine,the Net Tangible Disclosure is required and it is effective immediately.The discloure can be found at the end of the document in attachment A at the following link. Click Here
New York:The following street address should be added after the PO Box in the new MERS address for the NY assignments and Mortgages: 3300 S.W. 34th Ave Suite 101 Ocala, FL 34474. This is effective immediately.
Compliance Update for the week ending December 04,2007
California:Per California Assembly Bill 886,there is a new notary format required in effect from January 1, 2008.The new format can be found at the following link. Click Here
Compliance update for the week ending October 29,2007
Massachusetts:Two new disclosures are required for the state of Massachusetts by January 2008, one for the Mortgage Bankers and the other for Brokers.The name of the form is Important Notice of Loan Terms and can be found at the following link. Click Here
Compliance update for the week ending October 26,2007
There are new modifications in the Flood Insurance Notice. The Flood determination form remains the same but the notice of Flood Hazard is now broken down into two mandatory notices,one for the participating communities and one for the non-participating communities.Click on the following link to find the sample forms. Click HereCompliance update for the week ending October 19,2007
The HUD issued Mortgagee Letter 2007-13 which provides instruction for using the LIBOR index for ARMs.The Federal Housing Administration announced that the Department of Housing and Urban Development published a final rule in the Federal Register at 72 FR 40048 amending regulations at 24 CFR 203.49(b) to permit FHA to insure all forward adjustable rate mortgage (ARM) loan products using the 1-Year London Interbank Offered Rate (LIBOR) as an acceptable index option.More information available on the following link. Click HereCompliance update for the week ending October 12, 2007
Arkansas:A new disclosure is required for independent mortgage bankers and brokers effective for all the closing as of October 1st,2007 in the state of Arkansas. The new disclosure is available at the following link. Click here
All States:There are minor changes in the IRS W-9 form dated September 2007. The updated form is available at the following link. Click here
Compliance update for the week ending October 1, 2007
California:A new disclosure is due in 60 days for all the non-traditional products in CA. The new disclosure is available at the following link. Click here
All States:The applicants who have received an adverse action letter and want to complain to their lender's regulator can use the following address. This is applicable only to the lenders whose regulator is the Federal Reserve.Here is the relevant information from the Federal Register:
State member banks,branches and agencies of foreign banks (other than federal branches, federal agencies, and insured state branches of foreign banks), commercial lending companies owned or controlled by foreign banks, and organizations operating under section 25 or 25A of the Federal Reserve Act : Federal Reserve Consumer Help Center, P.O. Box 1200, Minneapolis, MN 55480 Toll-free number: (888) 851-1920
Compliance update for the week ending September 26, 2007
Nevada:A new disclosure is required in Nevada for any reduced, no documentation loan as of October 1,2007 for any loans in the process or ready to close effective from October 1,2007. Another part of the same revised statute also requires HOEPA loans in Nevada to contain a notice on the first page of the Deed of Trust that states the loan is a home loan as defined by NRS 598D.040. The form can be found at the following link Click here
Connecticut:Effective from October 1st, of next year,Connecticut will have a 3/4 inch all sides minimum margin requirement. Check your mortgage and make any required adjustments.
Compliance update for the week ending September 14, 2007
Colorado Adopts "Reasonable Inquiry and Tangible Net Benefit" Emergency Rule :Earlier this year, the Colorado legislature passed legislation (HB 07-1322 and SB 07-216) that, among other things, impose an affirmative duty of good faith and fair dealing by mortgage brokers with borrowers, including, without limitation, the duty (a) to make a "reasonable inquiry" into a borrower's current and prospective financial condition based on information submitted by the borrower, and (b) to not recommend or induce a borrower into a loan transaction that does not have a "reasonable, tangible net benefit" to the borrower. These duties are codified in new C.R.S. Section 12-61-904.5. In order to "clarify uncertainties regarding reasonable inquiry and tangible net benefit" requirements in the new law, the Colorado Director of the Division of Real Estate has adopted an emergency rule. The emergency rule became effective on September 4, 2007. A new disclosure required of mortgage brokers in Colorado is available here
Compliance update for the week ending August 24, 2007
The following are important changes without notice from Freddie Mac and Fannie Mae found on the authorized changes page and could be effective from earlier this summer.
California:In all Deeds of Trust (First Seconds, HELOC, Reverse etc) the following statement should be added above the signature line and after the 'By Signing Below' sentence: "The Undersigned Borrower requests that a copy of any Notice of Default and any Notice of Sale under this Security Instrument be mailed to him at the address of the Borrower set forth above. A copy of any Notice of Default and any Notice of sale will be sent only to the address contained in this recorded request. If the Borrower's address changes, a new request must be recorded".
Pennsylvania:It is mandatory that the Originators must add the following language to the end of the Mortgage in the second column above the signature block in all the security instruments: "This is a contract under seal and may be enforced under 42 Pa .C. S. Section 5529(B)". The above change should be made to Notes also making PA a new State Specific state.
Compliance update for the week ending August 3, 2007
The revised VA Loan Analysis Form is available at the following link Click here
Compliance update for the week ending August 1, 2007
Fannie Mae and Freddie Mac have jointly developed uniform master and short form security instruments for first mortgage loans.The new uniform master form mortgage or deed of trust ("Master Form")and Short Form documents have been placed on
www.efanniemae.comRead More
Compliance update for the week ending July 20, 2007
Non Traditional Mortgages: Beginning with all applications on or after September 13, 2007 (for both Fannie Mae and Freddie Mac), borrowers must qualify with the fully indexed payment for interest only ARM's and at the note rate (principal and interest) on fixed loans. Please review the attached announcements from Fannie Mae and Freddie Mac regarding non traditional products. Read More
Compliance update for the week ending July 02, 2007
Colorado: The Colorado legislature has enacted SB 07-216 and HF 07-1322 (collectively referred to as "the Acts"), which among other provisions, require that mortgage brokers make a "reasonable inquiry" about the borrower's income and obligations prior to recommending a particular program or product; prohibit mortgage brokers from recommending or inducing borrowers to enter into a transaction that does not have a reasonable tangible net benefit; and prohibit mortgage brokers and mortgage originators from engaging in "unconscionable" practices. SB 07-216 is effective July 1, 2007, and SB 07-1322 became effective June 1, 2007. The changes described are effective for loans closed on or after July 1, 2007.
Because the Act requires residential mortgage brokers to make a reasonable inquiry into a borrower's income, GMAC-RFC will not purchase, warehouse, or acquire servicing of any loan secured by property in Colorado originated with the following documentation:
Minnesota: The Minnesota legislature passed two bills, House File 1004 and Senate File 988, to protect consumers from alleged Predatory lending practices. The changes are effective for loans closed on or after August 1, 2007.Because the Act requires residential mortgage originators and exempt persons to verify income, GMAC-RFC will not purchase, warehouse, or acquire servicing of any loan secured by property in Minnesota originated with the following documentation:
Compliance update for the week ending June 22, 2007
Indiana: Indiana has changed its recording requirements that will impact your MERS as original mortgagee mortgages and assignments in Indiana. IC 32-21-2-3 requires the street address to follow the P.O. address effective JULY 1, 2007. For Non MERS mortgages the lender is the mortgagee and they typically use a physical address or the lender completes this variable field, so Non MERS instruments should not pose a problem. The INDIANA MERS CONVENTIONAL MORTGAGE was changed this way:
REVISION HIGHLIGHTED BELOW:
(C) "MERS" is Mortgage Electronic Registration Systems, Inc. MERS is a separate corporation that is acting solely as a nominee for Lenders and Lender's successors and assigns. MERS is the mortgagee under this Security Instrument. MERS is organized and existing under the laws of Delaware, and has an address and telephone number of P.O. Box 2026, Flint, MI 48501-2026, 3300 S.W. 34th Avenue, Suite 101, Ocala, FL 34474, tel. (888) 679-MERS.
Compliance update for the week ending June 15, 2007
Texas: New Disclosure is required for all lenders and brokers effective from September 1,2007.It must be signed by the applicant.Read More
Compliance update for the week ending April 27, 2007
Virginia: Change in notary requirements allowing for electronic signatures now also requires per Va. Code Ann. § 47.1-15(3) that the notary section must be on the same page as the signature lines.The effective date is July 2008.
Compliance update for the week ending April 20, 2007
The Rhode Island Home Loan Protection Act permanent regulations will replace previously adopted emergency regulations that expire on May 1, 2007, after a few extensions. The permanent regulations made several changes to the emergency regulations that affect disclosure content. The changes were minor but significant enough to change them, if they are already complete. The permanent regulations are effective from May 1, 2007; but will delay any actions for any issues related to the use of disclosures until June 1, 2007. The new samples disclosure are available online from the State of Rhode Island website.
Compliance update for the week ending March 23, 2007
Coming this Spring: Uniform Master Form and Short Form Security Instruments from Fannie and Freddie - Fannie Mae and Freddie Mac will make their jointly developed master form and short form uniform security instruments available soon. The short form security instruments are significantly shorter than the current uniform security instruments, which will reduce recording costs in states where fees are based on the number of pages recorded.
Compliance update for the week ending February 2, 2007
FREDDIE MAC - Freddie Mac posted a correction to the Note 5548 (Multistate ARM note). The section 4B has been modified and the revision date has been updated to 01/07 in the footer on each page. The new file is posted on the FREDDIE MAC website.
Compliance update for the week ending January 19, 2007
ILLINOIS -
ILLINOIS's new "Predatory Lending Database" initiative/HB4050 was shut down by the Governor. This database was tracked by zip code causing alarm and therefore the regulation has been pulled and will be redesigned to better serve its purpose.
For more information, click on News
To view the memo, click on Memo
OHIO -
On January 5, 2007 the Ohio Atttorney General posted the final forms for SB185, which can be viewed at the following link. Click Here. To view these forms go to the last link in the "Recently Released Rules" section titled "Forms for Suppliers*". There you will find the following three forms:
1. Ohio Homebuyers' Protection Act - Informational Document
2. Closing Disclosure Form
3. Acknowledgment of Receipt of Home Mortgage Loan Informational Document.
These forms are mandatory for Brokers and Independent Mortgage Banker's. Supervised Lenders are exempt. The first form is the actual disclosure to be used at the time of application or with the standard 3 day within application date. The second form, Closing Disclosure, is mandatory and is to be the first document to be signed at closing. The third form acknowledges reciept of the first form and can be used as an origination or closing document or both.
Compliance update for the week ending January 12, 2007
The new Senate Bill 185 forms have a mandatory use date of January 1, 2007. However the forms posted by the Ohio State Department on their website are still in the "draft format". These forms are avaiable in the following link. Click here.
The forms that are revised are:
1. Notice of Change in Mortgage Terms
2. Ohio Mortgage Loan Origination Disclosure Statement (MLOD)
3. Addendum to the Mortgage Loan Origination Disclosure Statement
4. Addendum to the Good Faith Estimate
Please note that the "MLOD" is needed on all the loans. The other 3 form are situational.
Compliance update for the week ending January 5, 2007
The State of Ohio has passed Bill 185. This bill requires certain disclosures which would be posted on this website soon.
Rhode Island has passed its Home Loan Protection Act effective from 12-31-2006. Emergency Regulation 3 to this Act has just been released and requires 5 new disclosures. The first two disclosures are required on every loan. The forms are a part of the link given below and may not be altered. This act is mandatory from February 1, 2007. Click here