March 2016 Newsletter
Welcome back to the PPDocs monthly newsletter. As you know, we are always busy developing, testing, implementing, and keeping pace with industry changes, and this is the place to stay informed of those new developments.
As always, we continue to strive for excellence both in customer service and products. We welcome all feedback, anything from topics covered in monthly newsletter to system changes please let us know!
In this issue:
FNMA Updates Spanish Resource Page
Spanish speaking consumers represent one of the largest growing segments of the mortgage market. To assist in this growing market, FNMA has released an easy to find version of loan origination documents on its website. You may find a link below!
FNMA Spanish Page
Texas Title Company Name and License IDs – Who’s Responsible?
We’ve received a number of questions from many clients inquiring on who is responsible for maintaining the correct license ID number which appears on the TRID documents. Not only are our clients questioning who is responsible but where do you verify licensing numbers?
It is the opinion of this law firm, that the lender is solely responsible for listing the correct legal name and license number within the contact list on the closing disclosure and, in Texas at least, those license numbers are readily available to the bank through the Texas Department of Insurance website. Similarly, the information regarding license numbers for the real estate brokers are available from the Texas Real Estate Commission website. We have been witnessing that the title companies and other parties listed in the contact section of the closing disclosure are not providing their correct license numbers and in some instances, they are not even providing their legal name as registered. We have been recommending to clients that they utilize these resources to double check the information provided by third parties prior to placing the information in the contact section of the closing disclosure. Relying on what may or may not be provided to them by a third party may not be accurate, and since the information is readily available to the lender, may not meet good faith standards.
See below for the Official Interpretation:
38(r) Contact information.
2. Name of person. Where § 1026.38(r)(1) calls for disclosure of the name of the person participating in the transaction, the person’s legal name (e.g., the name used for registration, incorporation, or chartering purposes), the person’s trade name, if any, or an abbreviation of the person’s legal name or the trade name is disclosed, so long as the disclosure is clear and conspicuous as required by § 1026.38(t)(1)(i). For example, if the creditor’s legal name is “Alpha Beta Chi Bank and Trust Company, N.A.” and its trade name is “ABC Bank,” then under § 1026.38(r)(1) the full legal name, the trade name, or an abbreviation such as “ABC Bank & Trust Co.” may be disclosed. However, the abbreviation “Bank & Trust Co.” is not sufficiently distinct to enable a consumer to identify the person, and therefore would not be clear and conspicuous.
5. License number or unique identifier. Section 1026.38(r)(3) and (5) requires the disclosure of a license number or unique identifier for each person (including natural persons) identified in the table who does not have a NMLSR ID if the applicable State, locality, or other regulatory body with responsibility for licensing and/or registering such person’s business activities has issued a license number or other unique identifier to such person under § 1026.38(r)(3) and (5).
FNMA News – Continuity of Obligation
The continuity of obligation policy is being eliminated in its entirety. This policy was introduced during the financial crisis, to ensure borrowers who recently acquired ownership of a new property in the absence of a recorded sale of the previous property were properly qualified and it applied to all limited cash-out and cash- out refinance transactions. Since this policy was introduced, Fannie Mae has implemented a number of policy updates to improve the reliability of borrower qualification, broadened the collection of appraisal data, and developed Collateral Underwriter®, an appraisal assessment tool. These actions collectively provide adequate controls to ensure borrower eligibility requirements and maximum LTV ratio limits are met. As a result, the continuity of obligation policy is no longer required. The elimination of this policy will simplify refinance transactions.
Freddie Mac Announces Guide Bulletin
Updates to requirements for loan-to-value (LTV)/total LTV (TLTV)/Home Equity Line of Credit (HELOC) TLTV (HTLTV) ratios for super conforming Mortgages and 1-unit Investment Property Mortgages
Updates to the minimum required Indicator Scores for Manually Underwritten super conforming Mortgages
FHLMC Selling 2016-3
Update to PPDocs eDisclosures – Effective April 15th
PPDocs has partnered with DocuSign (www.DocuSign.com), the leading e-Sign vendor in the industry to handle our eDisclosure/eSign process going forward.
DocuSign has over 50 million registered users and are the premier vendor for electronic signatures.
The service fee to electronically disclose and electronically sign will be $3 per transaction effective April 15th 2016. By joining forces with DocuSign, we are able now to provide the following features:
- e-Sign to multiple borrowers with a click of a button. We will build a package and pre-fill the borrowers name and email address from the order form (There is no additional charge for multiple borrowers).
- DocuSign now handles all email delivery to the borrower and notifications back to you. DocuSign is whitelisted by all major email providers to ensure delivery of your time sensitive material.
- You can customize who the responses go to on each individual package or use the account defaults.
- You are notified every step of the way, when the customer views, revokes, and signs via email or via our e-Sign manager.
- Borrowers will be able to use DocuSign’s portal to easily sign from any device (including mobile devices).
- With investors requiring your e-Sign vendor to be on an approved list, this will ensure your compliance as DocuSign is investor approved.
- Signed packages and DocuSign’s e-Sign Compliance Certificate are returned to PPDocs and will be stored with your loan file.
- We now have the ability to share your e-Sign packages with other users in your organization. Similar to our Casefile sharing, users will have the ability to select another loan officer/closer and see what has been viewed, signed, or revoked.