Under applicable Massachusetts law (M.G.L. c. 183, Section 28C; 209 CMR 53.00; links are here and here, respectively), a lender may not make a home loan if that home loan pays off all or part of an existing home loan that was consummated within the prior sixty (60) -- month period; unless, the new home loan is in the "borrower's interest." A "home loan" is defined as essentially any consumer purpose loan repayment of which is secured by a 1- to 4-family owner-occupied dwelling.

The DocMagic System has been updated to reflect the July 1, 2006, increased late fee dollar amounts for loans made under the consumer credit codes in Indiana, Minnesota, Oklahoma and South Carolina. The following changes were made: (i) Indiana late fee dollar amount was $16.50, changed to $ 17.00; (ii) Minnesota late fee dollar amount was $6.24, changed to $6.86; (iii) Oklahoma late fee dollar amount was $20.00, changed to $20.50; and (iv) South Carolina maximum late fee dollar amount was $14.50, changed to $15.50, and minimum late fee dollar amount was $5.80, changed to $6.20.

This month we add information regarding the Tennessee Home Loan Protection Act, which becomes effective on January 1, 2007. Please visit our High Cost/Predatory Lending Page to review this and other high-cost memos that have already been posted on the Compliance page of our website.

As of July 1, 2006, many of our customers originating loans in Indiana may have noticed the following statement at the end of the mortgage:

I affirm, under the penalties for perjury, that I have taken reasonable care to redact each Social Security number in this document, unless required by law.

__________________ Signature of Preparer

Document Systems, Inc.'s generic Balloon Payment Disclosure has been updated. The most significant change is that the sentence, "This loan was amortized over a ____ month period," has been added at the end of the first paragraph of the Disclosure. The defined term of "'Balloon Payment' amount", which was a parenthetical in the first paragraph, was also deleted as it was determined to be superfluous.

This month DSI posts loan programs of ABN AMRO Mortgage, SunTrust Mortgage, and Wells Fargo Bank to its Compliance page. Find out the description of each investor's loan program, which promissory notes, prepayment riders and addenda are used, and what the rate caps and interest-only periods are for variable rate loans. Visit our Compliance page next month to see other investors' loan programs.

Document Systems, Inc. ("DSI") has added a new enhancement to DocMagic: when a Loan Program is loaded that has a Default Payment Rate feature, clicking on the calculator button next to the "Monthly Payment" field will allow the DocMagic user to insert the payment rate so that the resulting monthly payment will be automatically computed. Only certain Negative Amortization Hybrid ARM Loan Programs will have this feature.

In order to keep DocMagic software users better apprised of document changes and additions as they occur, DSI posts listings of all newly created and revised documents. Here is the list of forms created or modified in June, 2006.