Financial Regulatory Reform: The New Rules on Loan Originator Compensation
|
|
- Alexia Dalton
- 8 years ago
- Views:
Transcription
1 Financial Regulatory Reform: The New Rules on Loan Originator Compensation 1
2 Introduction NOTICE: This information is not intended to be used as legal advice to any person or entity. The information contained in this presentation has been compiled from various public sources. Please consult your counsel for additional information. 2
3 Introduction What is the Final Rule? On August 16, 2010, the federal Reserve Board issued a final rule to address loan originator compensation practices 75 Fed. Reg. 185 (Sept. 24, 2010) The Federal Reserve Board (FRB) has announced an amendment to Regulation Z, the implementing regulation for the Truth in Lending Act (TILA), regarding loan originator compensation (the Final rule). The Final Rule, effective for all loan applications received on or after April 1, 2011, regulates mortgage originator compensation and prohibits steering for all mortgage loan originators, in an effort to protect borrowers from unfamiliar lending and abusive compensation practices Effective date: April 1 st,
4 Introduction Goals of the new rule Protect mortgage borrowers from unfair, abusive, or deceptive lending practices; and Help ensure that consumers can choose from loan options that include the lowest interest rate and lowest amount of points and origination fees 4
5 Introduction What transactions are covered by the new rule? All closed-end consumer credit transactions secured by first of subordinate liens on a dwelling that are subject to TILA Includes closed-end reverse mortgage transactions All owner occupancies (first and second homes) All lien positions What transactions are not covered by the new rule? Open-end loans (ie: HELOCs) Timeshares Loan modifications not rising to level of refinance under Reg. Z Loans secured by real property that do not a dwelling (ie: vacant land) Loans not covered by TILA (ie: business purpose loans, such as a loan secured by a home purchased for use as a rental property) 5
6 Introduction Three main prohibitions in the new rule: Compensation based on loan terms or conditions: Loan originators may not receive compensation that is based on loan terms or conditions, other than loan amount Compensation from multiple sources: Loan originators may not receive compensation from the lender or other parties if the loan originator is receiving compensation directly from consumer Steering: Loan originators are prohibited form directing or steering a consumer to accept a mortgage loan that is not in the consumer s interest to increase the loan originator s compensation 6
7 Prohibition #1 Loan Terms 7
8 Prohibition #1 Loan terms or conditions: No loan originator shall receive and no personal shall pay a loan originator directly or indirectly, compensation based on any of the loan terms or conditions What is a loan term or condition? No express definition, but examples provided: Interest rate Annual percentage rate LTV ratio Prepayment penalty A factor that,, while not itself a loan term or condition, serves as a proxy for a loan term or condition (e.g. credit score or DTI ratio) On express exclusion also provided: Loan amount (when the loan originator s compensation is based on a fixed percentage of the loan amount) 8
9 Prohibition #1 Loan terms or conditions example: Practice Tip: credit score or DTI ratio is a proxy for a loan term or condition when either of these factors results in different interest rates for the same loan to different consumers, and the loan originator s compensation from the same creditor for these loans varies in whole or in part based on either of these factors Practice Example: Consumer A and Consumer B receive loans from the same loan originator and creditor. Consumer A has a credit score of 650, and Consumer B has a credit score of 800 Consumer A s loan has a 7% interest rate, and Consumer B s loan has a 6.5% interest rate because of the consumer s difference in credit score The creditor pays the loan originator $1,500 in compensation for Consumer A s loan and $1,000 in compensation for Consumer B s loan. NOT PERMITTED because the creditor varies compensation payments in whole or in part with a proxy for a loan term or condition (i.e. the consumers credit scores reflect difference in interest rate) 9
10 Prohibition #2 Compensation From Multiple Sources 10
11 Prohibition #2 Brokers cannot collect compensation from both the borrower and the lender. On a level basis, the broker will be required to designate at the time of application the compensation method; Borrower-paid or Lender-paid The broker may choose which method works best for their respective business model. However, once the compensation method is selected, it may not change for that transaction For purposes of loan originator compensation, seller contributions are considered paid by the consumer. 11
12 Prohibition #2 Borrower-Paid Highlights Amount of compensation is negotiated between you and your borrowers Borrowers may use credits from the interest rate chosen to pay for third party fees, but such credits may not be used to cover any amount of the Borrower-Paid Broker compensation Brokers can lower compensation, pay for tolerance violations or offer credits towards third party costs Borrowers may pay discount points to reduce their interest rate 12
13 Prohibition #2 Lender-Paid Highlights 100% of the Broker s compensation must be paid by Majestic Home Loan. For purposes of the Final Rule, Yield Spread Premiums will always be considered Lender-paid. Compensation must match exactly to Broker s schedule of fees on file with company Borrowers may also use credits from the interest rate chosen to pay for third party fees Borrowers may pay discount points to reduce the interest rate Broker may not reduce commission to pay for tolerance violations, credit third party fees or offer other concessions 13
14 Prohibition #2 Borrower-Paid vs Lender-Paid Comparison Borrower-Paid Lender-Paid Source of Compensation All broker compensation paid by the borrower at closing with their own funds or with the proceeds of the loan All broker compensation paid by Majestic Home Loan through interest rate yield Amount of Compensation Loan Officer Compensation Premium Pricing Credit Broker negotiates broker origination fee and processing fee directly with the borrower Hourly wage or salary only Any premium pricing credit must be credited to the borrower and may only be used to pay third party closing costs and any Majestic Home Loan lender fee. *May not be used to pay any origination charge. Broker will choose their compensation margin in which they wish to operate; subject to change during a 5 day review period every 30 days Subject to agreement between broker company and loan officer Any premium pricing credit must be credited to the borrower and may be used to pay third party closing costs, broker fees and any Majestic Home Loan fee Steering Provision Not Applicable Title and Settlement Services Concessions Tolerance cures are deducted from compensation. Broker credits allowed. No broker credits. Origination may not be reduced at any time during the transaction. 14
15 Prohibition #2 Lender-Paid Compensation The following shows a sample rate sheet and the proper disclosure of lender-paid compensation on the GFE. For this example, the loan amount is $200,000. The rate selected is 4.750% for a 30 day lock and the above par pricing to the consumer is 1.134% or $2,268 Lender-Paid Broker Compensation is at a 2% margin; Lender fee = $795*; Title and settlement services = $3,000. Rate Lender Paid Scenario Agency 30 Year Fixed+ 30 day NOTE: The borrower credit can be used to pay all fees in Box 1 including broker compensation *Lender Fee can vary by state. GFE Section Amount Calculation Block 1 $4,795 Lender-Paid 2% broker comp. + Lender Underwriting Fee Block 2 $2,268 Discount paid by borrower Block A $7,063 Block 1 + Block 2 Block B $3,000 Title and Settlement Services Total Fees Paid by Borrower Total Broker Compensation $10,063 Block A + Block B $4,000 Broker Fee 15
16 Prohibition #2 Borrower-Paid Compensation The following shows a sample rate sheet and the proper disclosure of borrower-paid compensation on the GFE. For this example, the loan amount is $200,000. The rate selected is 4.750% for a 30 day lock and the above par pricing to the consumer is.866% or $1,732. Negotiated Broker Fee = $3,500; Broker Processing Fee = $500; Lender Fee = $795*; Title and Settlement Services = $3,000. Borrower-Paid Scenario Agency 30 Year Fixed+ Rate 30 day GFE Section Amount Calculation Block 1 $4,795 Block 2 ($1,732) Block A $3,063 Block 1 + Block 2 Broker Fee + Broker Processing Fee + Lender Underwriting Fee Credit to borrower of.866% for an interest rate of 4.750% Block B $3,000 Title and Settlement Services NOTE: The borrower credit can be used to pay all fees in Box 1 including broker compensation *Lender Fee can vary by state. Total Fees Paid by Borrower Total Broker Compensation $6,063 Block A + Block B $4,000 Broker Fee + Broker Processing Fee 16
17 Prohibition #2 How to complete the GFE Block A The following shows a sample GFE and what fields need to be completed. Block 1 Broker Fee + Broker Processing Fee + Lender Underwriting Fee or Lender-Paid Broker Comp + Lender Underwriting Fee Block 2 Credit to Borrower of.866% for an interest rate of 4.750% or Discount paid by borrower. Block A Block 1 + Block 2 17
18 Prohibition #2 How to complete the GFE Block B The following shows a sample GFE and what fields need to be completed. Block B Total Title and Settlement Fees Total Fees for Consumer Block A + Block B 18
19 Prohibition #3 Steering 19
20 Prohibition #3 How does the rule prohibit steering Loan originators are prohibited from directing or steering a consumer to a dwelling-secured loan based on the fact that the originator will receive greater compensation from the creditor in that transaction than in other transactions the originator offered or could have offered, unless the consummated transaction is in the consumer s interest. Directing or steering = advising, counseling, or otherwise influencing a consumer to accept a particular dwelling-secured loan Transaction must be closed 20
21 Prohibition #3 What does it mean to be in the consumer s interest? The transaction must be compared to other possible loan offers available through the originator (if any) for which the consumer was likely to qualify at the time of the transaction Possible loan offer = an offer that the creditor likely would extend upon receiving an application from the consumer (ie; offer does not need to actually be extended) Available = loan could be obtained from a creditor with which the loan originator regularly does business Likely to qualify = based on a creditor s standards and credit terms at the time of the transaction Good faith belief Based on information reasonably available May rely on information provided by consumer, even if subsequently determined to be inaccurate Loan originator not expected to know all aspects of creditor s underwriting criteria (only pricing and other information creditors routinely communicate to loan originators, such as rate sheets and minimum credit scroes) 21
22 Prohibition #3 Three ways to satisfy the prohibition: 1. Creditor Employees: Loan originator employees of creditors complying with the provisions of the rule prohibiting compensation based on loan terms and conditions in originating loans for their creditoremployers (ie; loan not brokered to another creditor) are deemed to comply with the steering prohibitions - Employee loan originators must comply with either 2 or 3 below when brokering a loan to another creditor. 2. Safe Harbor: Satisfy the Safe Harbor requirements 3. Least amount of Compensation: The loan originator reviews possible loan offers available from a significant number of creditors with which the originator regularly does business and directs consumer to the transaction that will result in the least amount of creditor-paid compensation to the loan originator. 22
23 Prohibition #3 Significant number of creditors = 3 or more creditors with whom loan originator regularly does business If loan originator regularly does business fewer than 3 creditors, loan originator is deemed to comply by obtaining offers from all creditors with whom it regularly does business Regularly does business = a loan originator regularly does business with a creditor if: There is a written agreement between the originator and the creditor governing the originator s submission of mortgage loan applications to the creditor; The creditor has extended credit secured by a dwelling to 1 or more consumers during the current or previous calendar month based on an application submitted by the loan originator; or The creditor has extended credit secured by a dwelling 25 or more times during the previous 12 calendar months based on applications submitted by the loan originator. For this purpose, the previous 12 calendar months begin with the calendar month that precedes the month in which the loan originator accepted the consumer s application 23
24 Prohibition #3 How is the Safe Harbor satisfied? 1. Consumer must be presented with loan options from a minimum number of 3 creditors with whom the loan originator regularly does business, that includes: A loan with the lowest interest rate; A loan with the lowest interest rate with no risky features (e.g. negative amortization, prepayment penalty, interest-only payments, balloon payment within first 7 years, demand feature, shared equity, shared appreciation); and A loan with the lowest total dollar amount for origination points or fees and discount points 2. If more than 3 loan options are presented for each type of transaction, loan originator should highlight the three loan options which meets the above criteria; and Less than 3 loan options for each type of transaction may be presented if the option(s) presented satisfy the above criteria (e.g., 1 loan meets all the requirements) 3. Loan originator believes in good faith that the consumer likely qualifies for the loan options presented 24
25 Prohibition #3 What is not required by the anti-steering provisions? Loan originator is not required to meet the safe harbor requirements Failure to satisfy the safe harbor does not subject the loan originator to any presumption that the loan originator failed to comply with the anti-steering provisions of the rule Loan originator is not required to establish a business relationship with any new creditors Loan originator is not required to inform a consumer about a potential transaction if the originator makes a good faith determination that the consumer is not likely to qualify Loan originator is not required to direct a consumer to the transaction that will result in a creditor paying the least amount of compensation to the originator Practice Tip: What is a creditor s liability for a broker violation of the prohibition on steering? A creditor s liability for a broker s violation with the steering provisions is not addressed under the Rule We strongly recommend that creditors impose a requirement on brokers to deliver a copy of a document evidencing compliance with these provisions (i.e., a borrower-signed document showing that he/she was offered loan options meeting the safe harbor) 25
26 Understanding Compensation 26
27 Understanding Compensation What is compensation? Fees the loan originator retains or keeps, regardless of the label or name given or associated with the fee Salaries, wages, commissions, and any financial or similar incentive, including: Annual or periodic bonuses; and Awards of merchandise, services, trips, or similar prizes What is not compensation? Amounts a broker receives and passes through for bona fide and reasonable third party charges (e.g. title insurance or appraisals) Contract Processing is a bona fide third party charge as long as the fee is paid through escrow/closing agent to a processing entity. 27
28 Understanding Compensation Broker Compensation Examples 1) Mortgage Broker charges a $400 application fee and uses that amount to pay $350 for a property appraisal and $50 for a credit report. Application fee does not constitute LO compensation for the purpose of the rule 2) Mortgage Broker deliberately marks up a third-party fee and retains the difference Mark-up amount retained is LO compensation 3) Mortgage broker is uncertain of the cost of a third-party charge at the time the $400 application fee is charged (ie; mortgage broker chooses from a list of appraisers that usually charge in a range of $300-$400 for a typical appraisal), and later the appraisal fee is determined to come in at $300 (ie; $50 less than expected) Mortgage broker may retain the $50 without it being deemed compensation under the FRB rule 28
29 Understanding Compensation What are permissible compensation methods? Compensation based on: Fixed percentage of the loan amount, where the fixed percentage remains the same for all loans (no tiers based on loan amount). Fixed minimum or maximum dollar amounts permitted. Overall loan volume (i.e. total dollar amount of credit extended or total number of loans originated) delivered to the creditor Long-term performance of the originator s loans An hourly rate of pay to compensate the originator for the actual number of hours worked Whether the consumer is an existing or new customer Payment that is fixed in advance for every loan the originator arranges for the creditor (e.g. $600 for every loan arranged for the creditor, or $1,000 for the first 1,000 loans arranged and $500 for each additional loan arranged) Percentage of applications submitted by the loan originator to the creditor that result in consummated transactions Quality of the loan originator s loan files (e.g. accuracy and completeness of the loan docs) or Legitimate business expenses, such as fixed overhead costs 29
30 Understanding Compensation Can Broker compensation be revised? If so, when? YES Periodic Revisions A creditor or other person paying a loan originator may periodically revise the loan originator s compensation prospectively, so long as the revised compensation is not based on a loan s terms or conditions. Factors such as loan performance, loan volume, and current market conditions may be reviewed and a loan originator s compensation revised prospectively based on that review. Majestic Home Loan allows one (1) tier change every 30 days. In order to request a tier change, a new Compensation Agreement must be completed and submitted online through the MTrac system. NO Modification of Loan Terms When a creditor offers a loan with specific terms and conditions, and subsequently, different terms or conditions are negotiated for that loan, the loan originator s compensation for that loan may not increase or decrease based on the renegotiated terms and conditions 30
BROWN, FOWLER & ALSUP A Professional Corporation Attorneys at Law MEMORANDUM
BROWN, FOWLER & ALSUP A Professional Corporation Attorneys at Law J. Alton Alsup 10333 Richmond, Suite 860 Telephone 713/468-0400 Board Certified in Residential Real Estate Law Texas Board of Legal Specialization
More informationAmendment to the AFR Wholesale Broker Agreement regarding Amendments to Regulation Z. Table of Contents
Amendment to the AFR Wholesale Broker Agreement regarding Amendments to Regulation Z Table of Contents Section 1 General Principles for Compliance 1.1 Mission Statement..... 2 1.2 Summary of TILA Amendment....
More informationMortgage Loan Originator Compensation (12 CFR 1026)
Mortgage Loan Originator Compensation (12 CFR 1026) In January 2013, the Consumer Financial Protection Bureau (CFPB) amended Regulation Z to implement requirements imposed by the Dodd-Frank Act concerning
More informationLoan Originator Compensation: The New Paradigm
Loan Originator Compensation: The New Paradigm Presented for Maryland Association of Mortgage Professionals on March 3, 2011 by Marjorie A. Corwin Gordon, Feinblatt, Rothman, Hoffberger & Hollander, LLC
More informationFinal Rule Governing Loan Originator Compensation Practices
August 31, 2010 Final Rule Governing Loan Originator Compensation Practices By Joseph Gabai Background On August 16, 2010, the Federal Reserve Board ( Board ) issued two proposed rules and three final
More informationDodd Frank Mortgage Reform 2014
Dodd Frank Mortgage Reform 2014 Business Partner Deck v1 12.16.13 Overview RULE EFFECTIVE DATE Loan Originator Compensation - TILA Loans closed and paid on or after 1/01/14 Ability to Repay/Qualified Mortgages
More informationMultistate Mortgage Committee (MMC) STATE NONDEPOSITORY EXAMINER GUIDELINES FOR REGULATION Z LOAN ORIGINATOR COMPENSATION RULE
I. INTRODUCTION Multistate Mortgage Committee (MMC) STATE NONDEPOSITORY EXAMINER GUIDELINES FOR REGULATION Z LOAN ORIGINATOR COMPENSATION RULE On August 26, 2009, the Federal Reserve Board (FRB) published
More informationMLO COMPENSATION, REGULATION Z, AND DODD-FRANK ACT
MLO COMPENSATION, REGULATION Z, AND DODD-FRANK ACT Vermont Mortgage Bankers Association & Mortgage Bankers/Brokers Association of NH Mortgage Compliance Conference Thursday, March 3, 2011 Sean P. Mahoney
More informationOverview The Regulation The Loan Estimate (LE) The Closing Disclosure (CD) Loan Estimate (LE) Application Date LE Responsibility
To support your preparation efforts when implementing the TILA-RESPA Integrated Disclosure (TRID) rule effective for applications dated on or after October 3, 2015, we have created this Helpful Tips for
More informationRegulatory Practice Letter
RPL Number 10-17 Financial Services Regulatory Practice Regulatory Practice Letter ADVISORY Amendments to Mortgage Loan Provisions under Regulation Z Executive Summary The Federal Reserve Board ( Fed )
More informationJanuary 20, 2015 Updated Changes:
Get Ready! Get Set! August 1, 2015 is Around the Corner THE COMBINED TILA AND RESPA MORTGAGE DISCLOSURES (Memo Updated on 1/27/15 to include the changes below) As most of you are probably aware, a major
More informationNational Banker Call
National Banker Call Loan Originator Compensation and HOEPA Final Rules Thursday, June 6, 2013 The information contained in this presentation is for informational purposes only and is provided as a public
More informationThe New Ability-to-Pay Rules; Qualified Mortgage Lending under the Dodd-Frank Act
The New Ability-to-Pay Rules; Qualified Mortgage Lending under the Dodd-Frank Act October 2011 Scott D. Samlin Partner T +1 212-398-5819 scott.samlin@snrdenton.com Stephen F. J. Ornstein Partner T +1 202-408-9122
More informationNEW CFPB RULES FOR HIGH COST MORTGAGES AND HOMEOWNERSHIP COUNSELING February 3, 2013
NEW CFPB RULES FOR HIGH COST MORTGAGES AND HOMEOWNERSHIP COUNSELING February 3, 2013 On January 10, 2013, the Consumer Financial Protection Bureau ( CFPB ) issued a final rule that carries out changes
More informationESCROW REQUIREMENTS UNDER TILA
Overview Escrow Requirements Reg. Z High Cost Mortgage and Counseling - Reg. Z & X Ability to Repay & Qualified Mortgages Reg. Z & X Mortgage Servicing Reg. Z & X Loan Originator Compensation Reg. Z Copies
More informationFRESH. Agenda. Credit Union Integrated Mortgage Disclosures Are you Prepared?
MCUL & Affiliates 2015 Annual Convention and Exposition Credit Union Integrated Mortgage Disclosures Are you Prepared? Glory LeDu Thursday, June 4, 2015 2:00 p.m. Sponsored by: FRESH Ideas to Reinvent
More informationCUNA s SUMMARY OF THE CFPB s MORTGAGE LENDING RULES Spring 2013
MANDATORY ESCROW ACCOUNTS Effective: June 1, 2013 REGULATION Requires escrow accounts be maintained for five years (rather than the current one year) for higher-priced mortgage loans. A higher-priced mortgage
More informationTo Receive CPE Credit
Revisions to Loan Originator Compensation & Qualifications Under TILA Nancy Schoolman Senior Managing Consultant nschoolman@bkd.com 314.231.9844 Sheldon Hendrix Managing Consultant shendrix@bkd.com 713.499.4600
More information1/22/2013. Mortgage U, Inc. Copyright 2012 Mortgage U, Inc. Copyright 2012 Mortgage U, Inc. Copyright 2012 Mortgage U, Inc.
Mortgage U, Inc Compliance Is A New World Consumer Financial Protection Bureau Qualified Mortgage QM final rule Points and fees amendment High Cost Mortgage Rules High Cost Appraisal Rules ECOA & HMDA
More informationNew Mortgage Rules Update
New Mortgage Rules Update 1 OBJECTIVES To provide information regarding the new mortgage rules, in particular: Ability-to-Repay/Qualified Mortgages; Mortgage Loan Origination Compensation; High-Cost Loans
More informationRegulatory Practice Letter February 2013 RPL 13-07
Regulatory Practice Letter February 2013 RPL 13-07 High Cost Mortgages and Homeownership Counseling; Escrow Requirements - CFPB Final Rules Executive Summary The Bureau of Consumer Financial Protection
More informationAbility to Repay/Qualified Mortgages FAQ
The Ability to Repay (ATR)/Qualified Mortgages (QM) provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act require lenders to make a reasonable, good faith determination of a borrower
More informationCFPB Issues Much Anticipated Final Rules: Ability to Repay, Qualified Mortgages, Escrow Requirements and Homeownership Counseling
CFPB Issues Much Anticipated Final Rules: Ability to Repay, Qualified Mortgages, Escrow Requirements and Homeownership Counseling The Consumer Financial Protection Bureau ( CFPB ) issued their much anticipated
More informationii. 25(c)(2) Records related to requirements for loan originator compensation and
4. In Supplement I to Part 1026 Official Interpretations: A. Under Section 1026.25 Record Retention: i. Under 25(a) General rule, paragraph 5 is removed. ii. 25(c)(2) Records related to requirements for
More informationEarly Summary of Ability to Repay and Qualified Mortgage Rules under Dodd-Frank Wall Street Reform and Consumer Protection Act.
Early Summary of Ability to Repay and Qualified Mortgage Rules under Dodd-Frank Wall Street Reform and Consumer Protection Act January 11, 2013 OVERVIEW - On January 10, 2013, the Consumer Financial Protection
More informationWhen do I have to start following the TILA-RESPA rule and using the new Integrated Disclosures?
............................................................................................. Overview of the TILA-RESPA Rule.............................................................................................
More informationCFPB Integrated Mortgage Disclosures
CFPB Integrated Mortgage Disclosures Today s Goal To help you not only understand the rule changes, but make sure you have the tools, resources and support to take action to implement in your credit union
More informationLoan Originator (LO) Compensation. III. Loan Originator Compensation Restrictions; Profits-Based Compensation Exceptions
Loan Originator (LO) Compensation 21 III. Loan Originator Compensation Restrictions; Profits-Based Compensation Exceptions Key Compensation Restrictions Loan originators may not receive compensation based
More informationRegulatory Practice Letter June 2012 RPL 12-11
Regulatory Practice Letter June 2012 RPL 12-11 Mortgage Rule Modifications under CFPB Consideration Executive Summary The Bureau of Consumer Financial Protection ( CFPB ) has announced that it intends
More informationABILITY TO REPAY/QUALIFIED MORTGAGE RULE
ABILITY TO REPAY/QUALIFIED MORTGAGE RULE Overview Information contained in this document is proprietary to Quicken Loans Inc. and may not be reproduced or disclosed without written authorization. This
More informationCLARIFICATION OF MAJOR CHANGES. Integrated Mortgage Disclosures
CLARIFICATION OF MAJOR CHANGES Integrated Mortgage Disclosures One of the mortgage industry s most anticipated provisions of the Dodd-Frank Act has been the integration of the Truth-in-Lending Act (TILA)
More informationMortgage Lending laws and how it affects you, the REALTOR. Presented by Anders Hostelley and Leonard Loventhal
Mortgage Lending laws and how it affects you, the REALTOR. Presented by Anders Hostelley and Leonard Loventhal Secure and Fair Enforcement for Mortgage Licensing Act Title V of P.L. 110-289, the Secure
More informationCFPB Proposes New Mortgage Disclosure Rules
A DV I S O RY July 2012 On July 9, 2012, the Bureau of Consumer Financial Protection (CFPB) issued a proposed rule on mortgage disclosures (Proposed Rule) implementing requirements of the Dodd-Frank Wall
More informationTILA-RESPA Integrated Disclosure Rule * January 21, 2015
TILA-RESPA Integrated Disclosure Rule * January 21, 2015 Presented by David Kantor Stinson Leonard Street LLP David.kantor@stinsonleonard.com 612-335-1620 1. Effective Date. The new Integrated Disclosures
More informationTILA-RESPA Integrated Disclosure Rule
TILA-RESPA Integrated Disclosure Rule May 13, 2015 Joseph J. Reilly Partner Benjamin K. Olson Partner 1 Key Changes Effective for applications received by the creditor or mortgage broker on or after August
More informationQUICK REFERENCE GUIDE TO DISCLOSURES TRUTH IN LENDING ACT AND REGULATION Z (1) (CLOSED-END HOME MORTGAGE TRANSACTIONS)
QUICK REFERENCE GUIDE TO DISCLOSURES TRUTH IN LENDING ACT AND REGULATION Z (1) (CLOSED-END HOME MORTGAGE TRANSACTIONS) Type of (2) Contents of Truth in Lending Statements 226.17 226.36 Early s 226.19(a)(1)
More informationBroker Compensation Overview
Broker Compensation Overview Paid Pid by either the Borrower or the Lender, but not both. Lender paid compensation is: Calculated as a percentage of the loan amount according to the Compensation Agreement
More informationFinancial Services Update - Special Alert January 30, 2013. CFPB Issues Final Loan Originator Compensation and Qualifications Rule
Financial Services Update - Special Alert January 30, 2013 CFPB Issues Final Loan Originator Compensation and Qualifications Rule On January 20, the CFPB posted its final rule (the Rule) regarding loan
More informationTILA-RESPA Integrated Disclosure (TRID) Correspondent Division. Overview. Loan Estimate (LE) Key points. Topic The Regulation
Overview The Regulation The Consumer Financial Protection Bureau (CFPB) issued a final rule amending Regulation Z (Truth in Lending Act) and Regulation X (Real Estate Settlement Procedures Act) to integrate
More informationLOAN SUBMISSION PROCEDURES
INTRODUCTION Brokers upload or manually enter data files and required documents via the website. Data files and documents submitted prior to 2:00 pm CT (Birmingham Fulfillment Center) or 4:00 p.m. PT (San
More informationTRID. What are the Timing Requirements for Revisions to a Loan Estimate?
TRID What is TRID? TRID is an acronym for TILA- RESPA Integrated Disclosure (also referred to as the TILA-RESPA Rule) and applies to most closed-end Borrower credit transactions secured by real property.
More informationThe New Mortgage Lending Process: A 2014 Check-Up and 2015 Planning
The New Mortgage Lending Process: A 2014 Check-Up and 2015 Planning Copyright 2012 Tata Consultancy Services Limited No Legal Advice, Opinions, or Services Provided This presentation does not constitute
More informationSection 1.35 Compliance Overview
Section 1.35 Compliance Overview In This Section This section contains the following topics: Overview... 2 Related Bulletins... 2 Nationwide Mortgage Licensing System Registry (S.A.F.E. Act)... 3 Nationwide
More informationHigher Priced Mortgage Loans Higher Priced Covered Transactions Qualified Mortgages High Cost Mortgage Loans Total Points and Fees
Seeded and Actual Questions from our Dodd Frank Act Mortgage Regulations Implementation Workshops Fort Walton Beach, Orlando, and Tampa September 2013 Ability to Repay Lending Questions 1. We are not sure
More information2013 Loan Originator Rule
JUNE 7, 2013 2013 Loan Originator Rule SMALL ENTITY COMPLIANCE GUIDE 1 Table of Contents Introduction 1. Introduction... 8 I. What is the purpose of this guide?... 10 II. Who should read this guide?...
More informationUpon completion you will be able to:
Agenda This training manual consists of three parts that will provide you with step-bystep instructions about how to complete the Closing Disclosure form required by the Integrated Disclosures Rule Upon
More informationHow To Pay A Loan Officer A Fixed Rate
Review of Loan Originator Compensation Rule Session 1 Presented by: v.1111911.bso AllRegs Academy. Know it all. . No part of this work may be copied, reproduced, or translated in any form or medium without
More informationCFPB FINAL RULES SUN WEST IMPLEMENTATION GUIDE
CFPB FINAL RULES SUN WEST IMPLEMENTATION GUIDE January 02, 2015 In case of any queries regarding the information available in this guide, please reach us at qmteam@swmc.com. Sun West Mortgage Company,
More informationTILA-RESPA Integrated Disclosures
Outlook Live Webinar- June 17, 2014 TILA-RESPA Integrated Disclosures Presented by the Consumer Financial Protection Bureau Visit us at www.consumercomplianceoutlook.org Disclaimer The Bureau issued the
More informationDOCUMENT REQUEST - COMPLIANCE REVIEWS - LENDING
Please prepare the Summary of Information items. Electronic format is preferred. () to be provided Pre-Exam () - to be available upon rrival COMPLINCE REVIEWS General Provide the names, titles, e-mail
More informationRegulation X Real Estate Settlement Procedures Act
Regulation X Real Estate Settlement Procedures Act The Real Estate Settlement Procedures Act of 1974 (RESPA) (12 U.S.C. 2601 et seq.) (the act) became effective on June 20, 1975. The act requires lenders,
More informationIntroduction. The new rules and forms take effect October 3 rd, 2015 for all loan applications submitted on or after that date.
Introduction The new rules and forms take effect October 3 rd, 2015 for all loan applications submitted on or after that date. Phased-in approach: Continue to close out loans in the lender s pipeline using
More informationBreak Out Session: Mortgage Loan Underwriting and Pricing
Break Out Session: Mortgage Loan Underwriting and Pricing Agenda Ability to Repay (ATR)/Qualified Mortgages (QMs) Effective Date: Applications received on or after January 10, 2014 2013 Home Ownership
More informationCFPB Consumer Laws and Regulations
Regulation X Real Estate Settlement Procedures Act The Real Estate Settlement Procedures Act of 1974 () (12 U.S.C. 2601 et seq.) (the Act) became effective on June 20, 1975. The Act requires lenders, mortgage
More informationCFPB Loan Disclosure Rules: Know Before You Owe Mortgage Forms The New Requirements and Their Impact on Financial Institutions
CFPB Loan Disclosure Rules: Know Before You Owe Mortgage Forms The New Requirements and Their Impact on Financial Institutions David A. Elliott Partner Richard C. Keller Partner OUTLINE Section 1032(f)
More informationTRID Quick Reference Guide
TRID General Rules and Definitions New Required Disclosures Loan Estimate (LE) replaces the GFE and Initial TIL Closing Disclosure (CD) replaces the Final TIL and HUD-1 Home Loan Toolkit replaces the HUD
More informationThe Impact of the CFPB s New Mortgage Rules on the Closing Process
The Impact of the CFPB s New Mortgage Rules on the Closing Process March 11, 2014 Banking & Finance Practice Escrow Account Rule 4 Escrow Account Rule Effective June 1, 2013. Extends current rule from
More informationTILA/RESPA Integrated Disclosures. BRIAN A. NETTLEINGHAM Attorney/Shareholder Regulatory Compliance Group
TILA/RESPA Integrated Disclosures BRIAN A. NETTLEINGHAM Attorney/Shareholder Regulatory Compliance Group BACKGROUND Dodd-Frank Wall Street Reform Act Created the Consumer Financial Protection Bureau National
More informationLOAN ORIGINATOR COMPENSATION: 2014 SEPTEMBER
1 BANKERS ASSURANCE COMPLIANCE CONFERENCE LOAN ORIGINATOR COMPENSATION: 2014 SEPTEMBER 26, 2014 TriNovus, LLC 2013 Presenter: Leah M. Hamilton, Director TriComply Services About the Speaker 2 Leah M. Hamilton
More informationSummary of the Mortgage Lending Provisions In the Dodd-Frank Wall Street Reform and Consumer Protection Act
Summary of the Mortgage Lending Provisions In the Dodd-Frank Wall Street Reform and Consumer Protection Act Prepared by Robert A. Cook and Meghan Musselman Hudson Cook Revised as of July 30, 2010 A Few
More informationKnow Before You Owe. TILA-RESPA Integrated Disclosure (TRID) Rule
Know Before You Owe TILA-RESPA Integrated Disclosure (TRID) Rule Background of CFPB The Consumer Financial Protection Bureau (CFPB) was established in 2010 under the Dodd-Frank Act Directed to publish
More informationHow To Serve A Mortgage In The United States
Break Out Session: Mortgage Loan Servicing and Administration 2 Agenda Mortgage Servicing Rules (Real Estate Settlement Procedures Act [RESPA] and Truth in Lending Act [TILA]) Effective Date: Applications
More informationGuide to Completing the Closing Disclosure The following list highlights requirements needed to complete each section of the Closing Disclosure (CD).
Guide to Completing the Closing Disclosure The following list highlights requirements needed to complete each section of the Closing Disclosure (CD). Page 1 Closing Information Date Issued Date the CD
More informationThe New Mortgage Servicing Rules. FMS East Coast Regional Conference September 17, 2013
The New Mortgage Servicing Rules FMS East Coast Regional Conference September 17, 2013 What are the new Mortgage Servicing Rules? Ability to Repay/Qualified Mortgage Rule 2013 HOEPA Rule Loan Originator
More information2013 Loan Originator Rule
JANUARY 13, 2014 2013 Loan Originator Rule SMALL ENTITY COMPLIANCE GUIDE 1 Version Log The Bureau updates this guide on a periodic basis to reflect finalized clarifications to the rule which impacts guide
More informationLoan Originator (LO) Compensation. II. Purpose, Coverage and Overview; Loan Originator and Compensation Defined
Loan Originator (LO) Compensation 1 II. Purpose, Coverage and Overview; Loan Originator and Compensation Defined Major Components of Rule Prohibits steering a consumer into a loan that generates greater
More informationHow To Write A Disclosure Form
Office of Consumer Protection Truth-In-Lending Real Estate Settlement Procedures Act Integrated Disclosures Webinar February 11, 2015 The information contained in this presentation is for informational
More informationCFPB THE NEW DISCLOSURE FORMS AND REQUIREMENTS BE READY!!
CFPB THE NEW DISCLOSURE FORMS AND REQUIREMENTS BE READY!! CELIA C. FLOWERS FLOWERS DAVIS, P.L.L.C. and EAST TEXAS TITLE COMPANY Tyler, Texas 75701 TILA and RESPA History 2012 TEXAS LAND TITLE INSTITUTE
More informationThe CFPB s New Mortgage Rules: Is Your Financial Institution Ready?
BSA COMPLIANCE LOAN REVIEW VENDOR REVIEW MORTGAGE REVIEW The CFPB s New Mortgage Rules: Is Your Financial Institution Ready? September 18, 2013 Presented by: David Senior, Director of Enterprise Risk Management
More informationTILA RESPA An Overview
TILA RESPA An Overview March 13, 2014 E. Andrew Keeney, Esq. Kaufman & Canoles, P.C. and Michael J. Coleman, Esq. NAFCU Director of Regulatory Affairs E. Andrew Keeney, Esq. Kaufman & Canoles, P.C. 150
More informationGuide to Completing the Loan Estimate The following list highlights requirements needed to complete each section of the Loan Estimate.
Guide to Completing the Loan Estimate The following list highlights requirements needed to complete each section of the Loan Estimate. General Information Page 1 Date Issued Date the LE is mailed or delivered
More informationTILA RESPA Integrated Disclosures. On October 3 rd, life as we know it will change forever. One of the new forms is.
TILA RESPA Integrated Disclosures The Loan Estimate and Miscellaneous Requirements Lynne Murphy Breen, Esquire Sue Ellen Rogal, Esquire September 16, 2015 On October 3 rd, life as we know it will change
More informationINTEGRATED MORTGAGE DISCLOSURES CLOSING DISCLOSURE
INTEGRATED MORTGAGE DISCLOSURES TILA RESPA RULE CLOSING DISCLOSURE Financial Solutions Patti Blenden October 2014 1 September 2014 Guide The Loan Estimate and Closing Disclosure must be used for most closed
More informationCFPB Regulations on Ability to Repay and Qualified Mortgages. MDDCCUA Training
CFPB Regulations on Ability to Repay and Qualified Mortgages MDDCCUA Training October 30, 2013 E. Andrew Keeney, Esq. Kaufman & Canoles, P.C. Ability-to-Repay and Qualified Mortgage Rules E. Andrew Keeney,
More informationEmployer to Employee Compensation:
Fowler Williams, CMB Executive Vice President Crescent Mortgage Company Fed Rule Question and Answer Update 3-16-2011 This Question and Answer is provided based on customer questions received by Crescent
More informationSPECIAL ALERT: CFPB PROPOSES SIGNIFICANT EXPANSION OF HMDA REPORTING REQUIREMENTS
SPECIAL ALERT: CFPB PROPOSES SIGNIFICANT EXPANSION OF HMDA REPORTING REQUIREMENTS JULY 30, 2014 On July 24, the Consumer Financial Protection Bureau (the CFPB or Bureau) issued a proposed rule that would
More informationRegulation X Real Estate Settlement Procedures Act
Regulation X Real Estate Settlement Procedures Act The Real Estate Settlement Procedures Act of 1974 (RESPA) (12 U.S.C. 2601 et seq.) (the Act) became effective on June 20, 1975. The Act requires lenders,
More informationCFPB Consumer Laws and Regulations
Real Estate Settlement Procedures Act 1 The Real Estate Settlement Procedures Act of 1974 () (12 U.S.C. 2601 et seq.) (the Act) became effective on June 20, 1975. The Act requires lenders, mortgage brokers,
More informationAbility to Repay & QM Regulations
Ability to Repay & QM Regulations 2013 Rushmore Loan Management Services LLC. All Rights Reserved. This is intended as educational material only. It does not provide legal advice. Revised December 2013
More informationCFPB Mortgage Amendments. Get Caught Up!
CFPB Mortgage Amendments Get Caught Up! Agenda HPML Appraisal Requirements High Cost Mortgage QM Points and Fees QM Cure Provision HPML Escrow Requirements HMDA Revisions Loan Estimate Form Closing Disclosure
More informationCFPB s RESPA TILA Integrated Disclosure. Finley P. Maxson NAR Senior Counsel fmaxson@realtors.org (312) 329-8381
CFPB s RESPA TILA Integrated Disclosure Finley P. Maxson NAR Senior Counsel fmaxson@realtors.org (312) 329-8381 RESPA-TILA Integrated Disclosure A. Background I. Impetus for change a. Dodd-Frank directed
More informationDodd Frank Act Mortgage Regulations Implementation Gap Analysis
POLICY CHANGES POL1 POL2 POL3 POL4 POL5 POL7 POL8 HPML & Reg B Appraisals HPML Appraisals Consumer (MH) Commercial & other consumer lenders compensation Tellers/Retail referral program Policy and/or SAFE
More informationOverview. General Requirements
Truth in Lending Act Overview Congress passed legislation increasing the amount and type of credit information disclosed to the consumer through Title I of the Consumer Credit Protection Act of 1968, known
More information2015 Fidelity National Title Group
Five Things You Need to Know Before August 2015 WHAT IS THE CFPB? THE NEW LINGO Dodd-Frank Act --Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 CFPB Consumer Financial Protection Bureau
More informationCFPB and Lenders. A presentation on the Consumer Financial Protection Bureau and its impact on the lending industry
CFPB and Lenders A presentation on the Consumer Financial Protection Bureau and its impact on the lending industry What is the Consumer Financial Protection Bureau (CFPB)? Independent agency of the United
More informationQM - Qualified Mortgages. Internal Training Use only July 1, 2014 #T014
QM - Qualified Mortgages Internal Training Use only July 1, 2014 #T014 Rules & Terms to Know QM ATR HPML High Cost Rebuttable Presumption Safe Harbor Excludable Discount Pts History of QM & ATR Rules The
More informationWebinar Thursday, January 16, 2014 2:00 3:30 pm ET
Webinar Thursday, January 16, 2014 2:00 3:30 pm ET Webinar Thursday, January 16, 2014 2:00 3:30 pm ET Moderator Roger Blauvelt Vice President & National Agency Counsel WFG National Title Insurance Company
More informationA Primer for a New Era in Closings: For loan applications received beginning August 1, 2015 some info courtesy of ALTA
A Primer for a New Era in Closings: For loan applications received beginning August 1, 2015 some info courtesy of ALTA A New Era in Closings Applicable Loans Final rule applies to most consumer mortgages,
More informationAbility to Repay and Qualified Mortgage Rule
Ability to Repay and Qualified Mortgage Rule The Consumer Financial Protection Bureau adopted a rule that implements the Ability to Repay and Qualified Mortgage ( ATR/QM ) provisions of the Dodd-Frank
More informationA Primer on the New CFPB Regulations Governing Residential Closings. Navigating the New Forms (Loan Estimate and Closing Disclosure.
A Primer on the New CFPB Regulations Governing Residential Closings. Navigating the New Forms (Loan Estimate and Closing Disclosure.) For loan applications received beginning October 3, 2015. Disclaimer:
More informationThis document contains Q &A for the Calyx Software Webinars held Feb. 22 & Feb. 23, 2011
This document contains Q &A for the Calyx Software Webinars held Feb. 22 & Feb. 23, 2011 The guest presenters from Abacus Mortgage Training and Education graciously answered the questions submitted during
More informationThe 4 CFPB Final Rules of the Dodd-Frank Wall Street Reform and Consumer Protection Act. December 2013
The 4 CFPB Final Rules of the Dodd-Frank Wall Street Reform and Consumer Protection Act December 2013 Agenda 1. LO Compensation 2. ATR / QM / TQM 3. ECOA & HPML 4. HOEPA & Home Counseling Agenda In the
More informationCFPB Regulations. Review & Enforcement
CFPB Regulations Review & Enforcement Agenda Welcome Overview 2014 Regulations Loan Originator Compensation and Training, Certification, and Identifier Disclosure High-Cost/HOEPA Mortgage Loans & Homeownership
More informationComparison of Section 35(HPML) & Section 32(HOEPA) Regulations Including CFPB 2013 & 2014 Updates As of 01/07/2014
Comparison of Section 35(HPML) & Section 32(HOEPA) Regulations Including CFPB 2013 & 2014 Updates As of 01/07/2014 General Consumer Loan Type Not Applicable HPML (12 CFR 1026.35) A closed-end consumer
More informationUNDERSTANDING THE LOAN ESTIMATE
The following breaks down the Loan Estimate by section with examples from Encompass followed by official commentary. Also attached, is a copy of a completed Loan Estimate form provided by the Encompass..
More informationFlorida Mortgage Laws and Regulations. Introduction. LegalEase was asked to review and summarize any legislation since January of 2007
23400 Michigan Avenue, Suite 101 Dearborn, MI 48124 Tel: 1-(866) 534-6177 (toll-free) Fax: 1-(734) 943-6051 Email: contact@legaleasesolutions.com www.legaleasesolutions.com Florida Mortgage Laws and Regulations
More informationComparison of Section 35(HPML) & Section 43(HPCT) Regulations
Comparison of Section 35(HPML) & Section 43(HPCT) Regulations As of 01/07/2014-VS General Consumer Loan Type Not Applicable A closed-end consumer credit transaction secured by the consumer s principal
More informationBrief Walk Through of TRID. Presented by: Scott Meerstein MGIC Inside Sales
Brief Walk Through of TRID Presented by: Scott Meerstein MGIC Inside Sales The information presented in this presentation is for general information only, and is based on guidelines and practices generally
More informationDodd Frank Act Mortgage Rules FAQs
Dodd Frank Act Mortgage Rules FAQs Qualified Mortgage (QM) Criteria 3% Fee Cap What goes in to the calculation of fees? The same test is used for HOEPA and for QM. It includes everything that goes in to
More informationSection 1026.43. Ability-to-Repay (ATR) 1026.43(c)(1) and Qualified Mortgage (QM) 1026.43(e), (f)
Section 1026.43 Ability-to-Repay (ATR) 1026.43(c)(1) and Qualified Mortgage (QM) 1026.43(e), (f) Effective January 10, 2014 As of 10/15/2013- By Venessa Snell This section applies to any consumer credit
More information