An Introduction to... Equity Settlement

Transcription

1 An Introduction to... Equity Settlement The New York CEMA & Co-op Process June 2009

2 About Us... Established in 1986 Over 100 Associates Approved Vendor for Bank of America Preferred Vendor for Many National Banks & Regional Mortgage Bankers 49 State Coverage; 33 Direct License States

3 = Direct License States Refinance & Purchase Transactions Available = Work Share States Refinance Transactions Only = Services Not Available Bundled price includes all settlement and title charges with the exception of title premium and recording fees. WA OR Not Available CA AK Not Available NV ID Not Available AZ MT WY UT CO NM Not Available ND SD NE KS $890 OK TX Not Available MN IA MO AR LA WI IL MS IN MI TN AL $1,260 KY OH GA WV $1,160 SC FL PA VA NC VT NY CEM - $950 ME NJ $465 DE MD CT DC MA NH RI PLEASE NOTE: NY, NJ and CT are the only states in which we offer Co-op Property Services. HI

4 Products Title, Settlement & Closing Multi-State Law Firm Purchases (in direct states) Refinances Government & FHA Loans CEMA s CO-OPS (NY, NJ & CT) Reverse Mortgages Home Equities

5 The Answers to FAQs Attorney States are those states that require an attorney, by law to facilitate part or all of a real estate closing transaction. The borrower does not need attorney representation to close a refinanced loan, nor does the borrower choose the closing agent. Equity Settlement Services Inc. or Puleo Delisle LLC fund the loan as the closing agent or attorney.

6 Title & Closing Facts How long does it take? - Title Commitment: 3-5 days (Refinances) 5-6 days (Purchases) Includes Wiring Instructions, CPLs, Payoffs and Taxes Where can we close? - Any Location, Anytime! We commute to your client! No Additional Fee!

7 CEMA: Consolidation Extension Modification Agreement The CEMA is utilized to significantly reduce the cost of mortgage tax in conjunction with financing real property located in New York State by leveraging New York Tax Law Section 255. We, at Equity Settlement Services Inc. are experts in this process. We can streamline the New York Refinance procedure from an ordering and processing standpoint to ensure that the Bank of America borrower is being directed with the most cost effective savings and that the bank itself, is being represented in the most professional manner.

8 Basics of a CEMA Only in New York State Eligible on first mortgage tax liability (which can be 2% in certain boroughs of New York) Mortgage tax fluctuates by county. Only taxed on the new money or cash out is the new loan amount minus the existing principal loan balance of the current loan.

9 Two Types of CEMAs & Applicable Consideration Internal CEMA (BofA to BofA) Minimal additional processing time. Additional costs associated with preparation and recording of the CEMA. External CEMA Average Additional processing time is approximately 6-8 weeks depending on cooperation of existing lender. Additional costs associated with preparation and recording of CEMA. Assignment Fees from existing lender vary some are a fixed fee, while others may be a percentage of the loan amount.

10 Internal CEMA Letter Hello, It was nice speaking with you. In order to proceed as a CEMA loan, please send an to the following department requesting internal approval to do so: They will send you a response which you need to forward to me, then please print a out a copy of the Note and Mortgage from FileNet. Thank you for your trust in us.

11 How do I Utilize the Equity Settlement CEMA Process? CEMA Calc on the Web - Order through LPS (Flow 4135, EM1Screen CEMA Indicator Box) NY CEMA Hotline: Phone: Fax:

12 Co-op Definitions Co-op: Co-operative Apartment (not real property). Co-op Board: The advisory and supervisory power of the corporation the owns the dwelling. Managing Agent: Advocate for the Co-op Board. Aztech Recognition Agreement: Board Approval Form. Certificate of Good Standing: Ensures all fees at paid to date. Authorization to File: Borrowers permission to file UCC. UCC: Uniform Commercial Code Form (Lien). Collateral Attorney: Attorney representing the existing lender. Proprietary Lease: A lease between a cooperative apartment association and the tenant. Stock Certificate: An instrument evidence of ownership or share in a co-operative.

13 Co-op Procedures: Refinance 4-6 weeks Co-operative Procedure Contact Borrower Co-op information for to borrower (exhibit 1) Aztech Recognition Agreement (exhibit 2a) Loan amount specific, no changes. Certificate of Good Standing (exhibit 2b) Authorization to File ($180 check) (exhibit 2c) Instructional Letter (exhibit 2d) Request Collateral & Order Title UCC to be filed when authorization to file is received from borrower (filing takes 2 weeks) Closing When Title is clear, Collateral Attorney is ready and UCC is filed, we can set up a closing date. Closing Requires 5 Business Days Notice, due to Collateral Attorney Preparation

14 Co-op Procedures: Purchase 4-6 weeks Co-operative Procedure Contact Buyers Attorney Once the contract is received, we prepare agreements. In Purchase the borrower will communicate directly with their attorney. Aztech Recognition Agreement (exhibit 2a) Loan amount specific, no changes. Certificate of Good Standing (exhibit 2b) Authorization to File ($180 check) (exhibit 2c) Instructional Letter (exhibit 2d) Request Collateral & Order Title Buyer and Sellers Attorneys to Handle, UCC to be filed when authorization to file is received from borrower (filing takes 2 weeks) Closing Requires 5 Business Days Notice, due to Collateral Attorney Preparation.

15 Co-op Pricing New York & New Jersey Settlement Fee $250 Document Preparation Fee $350 Lien Search $90 Recording Fee per UCC Connecticut Settlement Fee $250 Document Preparation Fee Co-ops are considered real property in Connecticut. Title Insurance Premiums and Recording Fees will apply.