September 28, 2022
PPDocs End-of-Year Holiday Schedule, PPDocs HELOC Webinar Available Online, CFPB Releases Overview of 2021 Mortgage Lending, OCC: Mortgage Performance Improves and more!
Read more below!
PPDocs End-of-Year Holiday Schedule
As a reminder, PPDocs offices will be closed on Thanksgiving Day, Thursday, November 24, 2022.
We currently do not have plans to close the office for any additional holidays in 2022. Clients will be notified in advance if this schedule changes.
PPDocs HELOC Webinar Available Online
On August 3, 2022, PPDocs provided a free HELOC webinar for clients. Topics include:
- Key difference between HELOCs and Closed-end credit
- Regulation Z requirements for HELOCs
- Requirements for a HELOC under the Texas Constitution
Click here to listen to the presentation by PPDocs attorney Matthew R. Filpi.
CFPB Releases Overview of 2021 Mortgage Lending
The CFPB released Data Point: 2021 Mortgage Market Activity and Trends providing an overview of residential mortgage lending in 2021 based on the data collected under HMDA.
The number of closed-end originations (excluding reverse mortgages) increased modestly from 13.4 million in 2020 to 13.7 million in 2021 or by 2.4 percent. Most of the increase was driven by an increase in the number of home purchase loans. The increase in home purchase loans was the most prominent among jumbo loans, likely reflecting rapidly rising house prices. In 2021, the share of home purchase loans by non-Hispanic White borrowers continued a downward trend while the share by Black borrowers continued an upward trend that began in 2018. The share of home purchase loans by Asian borrowers rose in 2021 after being relatively stable in the past three years.
The number of refinance loans decreased year-over-year by 1.7 percent. The refinance boom, especially in non-cash-out refinance that dominated mortgage market activities in 2019 and 2020, peaked in March 2021. The non-cash-out refinance volume dropped precipitously throughout the remainder of 2021. The downward trend coincided with the increase in market interest rates.
OCC: Mortgage Performance Improves
WASHINGTON - The OCC reported that the performance of first-lien mortgages in the federal banking system improved during the second quarter of 2022.
The OCC Mortgage Metrics Report, Second Quarter 2022 showed that 97 percent of mortgages included in the report were current and performing at the end of the quarter, compared to 95 percent a year earlier.
The percentage of seriously delinquent mortgages – mortgages that are 60 or more days past due and all mortgages held by bankrupt borrowers whose payments are 30 or more days past due – was 1.5 percent in the second quarter of 2022, compared to 1.8 percent in the prior quarter and 3.8 percent a year ago.
Servicers initiated 11,015 new foreclosures in the second quarter of 2022, a decrease from the prior quarter, but a higher volume than a year earlier. The new foreclosure volume in the second quarter of 2022 is lower than pre-COVID-19 pandemic foreclosure volumes.
Servicers completed 28,109 modifications in the second quarter of 2022, a decrease of 33.7 percent from the previous quarter. Of the 28,109 mortgage modifications, 78.2 percent reduced borrowers’ monthly payments, and 26,883, or 95.6 percent, were “combination modifications” – modifications that included multiple actions affecting the affordability and sustainability of the loan, such as an interest rate reduction and a term extension.
The first-lien mortgages included in the OCC’s quarterly report comprise 22 percent of all residential mortgage debt outstanding in the United States or approximately 12.2 million loans totaling $2.7 trillion in principal balances.
Frequently Asked Question
Question: When a lender takes a deposit account (e.g., a certificate of deposit) as additional collateral on a TRID loan, where does this appear on TRID disclosures? Similarly, when a lender takes real property as additional collateral, where does it appear on TRID disclosures?
Answer: When personal property is taken as additional collateral on a TRID loan, it does not show up on TRID disclosures. The disclosure for that is found in 1026.18(r) and applies only to non-TRID loans. When the CFPB wrote the TRID regulations, they simply did not include a similar requirement. The CFPB said this in the preamble to the initial TRID regulations.
- The disclosure required by current § 1026.18(r), which is not specifically required by TILA, is not a disclosure that the Bureau’s research and consumer testing indicates is important to consumers in understanding their loans. Accordingly, to reduce the potential for information overload for consumers, the Bureau is not requiring this disclosure in §§ 1026.37 or 1026.38.
A lender may use an addendum to the CD to describe the personal property. However, our system will suggest removing it because it is an optional document.
When real property is taken as additional collateral, then all real property must be disclosed, and, if the description of all the real property involved does not fit in the space provided on Page 1, then an addendum to the CD is required to be used.
38(a)(3)(vi) Property.
1. Alternative property. For guidance on disclosing the location of a property for which an address is unavailable, see the commentary to § 1026.37(a)(6). Where personal property also secures the credit transaction, a description of that property may be disclosed, at the creditor’s option, pursuant to § 1026.38(a)(3)(vi). If the form does not provide enough space to disclose a description of personal property under § 1026.38(a)(3)(vi), at the creditor’s option an additional page may be used and appended to the end of the form provided that the creditor complies with the requirements of § 1026.38(t)(3).