PPDocs, Inc. Announces Launch of eClose Offering, PPDocs Advisory on Use of IRS Form 4506-C, PPDocs System: LIBOR Audit to Change March 1 and more!

Effective today, PPDocs will begin offering hybrid eClosings using our proprietary technology. This will enable borrowers to electronically sign ancillary documents before the wet signing ceremony to speed up the process and limit errors.

The process will be similar to using our eSign enabled initial disclosures today! No additional training needed, the process of separating the documents into wet/eSign packages is handled by our intelligent splitting technology.

Settlement agent partners will also receive a similar experience; they will be able to track the progress of the borrowers to ensure everything is compliant and signed properly.
Additionally, we will begin to accept beta testers for our full eClose offering including eNotes and eVault, MERS eRegistry, as well as eNotary support.
For more information and to learn how to get started, please reach out to eClose@ppdocs.com

It has come to our attention that clients are sending copies of IRS Form 4506-C (IVES Request for Transcript of Tax Return) (“4506-C”) to borrowers to obtain electronic signatures through DocuSign. A signed 4506-C is only required if a lender is ordering transcripts or copies of other tax documents from the IRS when they are an IVES participant or using a third-party IVES participant.

For electronic signatures to be acceptable, they must be obtained using two factor authentication. Per the IRS:

• Authentication: IVES participants must validate that the signer is who they say they are and that the document has made it into the correct hands. The most common form of authentication is “Two Factor,” referring to something the signer has (e.g., emailed successfully into their in-box) and something the signer knows (e.g., a pass code). Other common authentication options include: Knowledge based Authentication (KBA) where the signer is presented with multiple choice questions, and Single Sign-On (SSO), where “keys” or credentials are passed along from another website.
  Source: https://www.irs.gov/individuals/international-taxpayers/how-to-get-started-using-ives-electronic-signature
  

  To ensure that our clients do not forget to require two factor authentication when sending the 4506-C documents out for electronic signature via DocuSign, we are updating our system on 02/16/22 to make this a requirement when a 4506-C is included in a package.

  You will see the following notice if a 4506-C is included in your package.

  

  As a reminder, sending any DocuSign package and requiring two factor authentication is always an option.

  

Effective March 1, 2022, the LIBOR soft audit in the PPDocs online portal will become a hard stop. The LIBOR index has been discontinued, and the financial institution regulators have encouraged lenders against its continued use. See FDIC: FIL-70-2021: Joint Statement on Managing the LIBOR Transition Given LIBOR’s discontinuance, the agencies believe that entering into new contracts, including derivatives, that use LIBOR as a reference rate after December 31, 2021, would create safety and soundness risks, including litigation, operational, and consumer protection risks.

Due to the inherent risks involved in using an index that has been discontinued and is strongly disfavored by regulators, it is our advice that the LIBOR index should not be used for ARM loans going forward. For this reason, we are making the selection of the LIBOR index a hard stop in our system. In the event a user wishes to override the audit and generate loan documents using the LIBOR index, PPDocs will require a written acknowledgment and authorization to proceed signed by a representative of the lender with the authority to make such an authorization before documents will be released.

The CFPB launched an initiative against “exploitative junk fees” charged by banks and financial companies by issuing a request for information from the public to help shape the agency’s rulemaking and guidance agenda, as well as its enforcement priorities. The CFPB also said it is interested in hearing from small business owners, non-profit organizations, legal aid attorneys, academics and researchers, state and local government officials, and financial institutions, including small banks and credit unions.

Interestingly, in a blog post, the CFPB singled out document preparation and title insurance fees under the heading of “closing costs and homebuying fees” in a list of “common junk fees.” The other headings are: late fees, fees to pay your bill, and prepaid card fees.

Read the CFPB’s Request For Information Regarding Fees By Providers of Consumer Financial Products or Services, and share your experiences by visiting the public comment page on the Federal Register.

Due to the inherent risks involved in using an index that has been discontinued and is strongly disfavored by regulators, it is our advice that the LIBOR index should not be used for ARM loans going forward. For this reason, we are making the selection of the LIBOR index a hard stop in our system. In the event a user wishes to override the audit and generate loan documents using the LIBOR index, PPDocs will require a written acknowledgment and authorization to proceed signed by a representative of the lender with the authority to make such an authorization before documents will be released.

The CFPB’s website now contains a chart entitled Reportable HMDA Data: A Regulatory and Reporting Overview Reference Chart for HMDA Data Collected in 2022. The CFPB intends the chart to as a reference tool for data points required to be collected, recorded, and reported under Regulation C. Relevant regulation and commentary sections are provided. The chart also incorporates the information found in Section 4.2.2 of the 2022 Filing Instructions Guide and provides when to report not applicable or exempt, including the codes used for reporting not applicable or exempt from section 4 of the 2022 Filing Instructions Guide.

Frequently Asked Question