May 2007
Unlike the Annual Percentage Rate (APR) calculation for closed-end transactions, the APR for HELOCs "does not include costs other than interest." Accordingly, the HELOC APR does not include finance charges that would typically be included in the APR calculation for closed-end transactions.
The Truth in Lending Act (TILA) provides consumers with the right to rescind certain consumer credit transactions.This rescission right (which is spelled out both in TILA and in its implementing regulation, Regulation Z (12 CFR §226.15 for open-end credit and §226.23 for closed-end credit)) applies to all borrowers and any consumer whose ownership interest in his or her principal dwelling is subject to a security interest. The following transactions are exempt from the right to rescind:
Now available to correspondent lenders of Indymac Bank is Form 5016, the Borrower's Income Affidavit. This Form will be needed for Indymac's Stated Income documentation loans delivered under its Preferred Delegated Underwriting program (PDU). The document provides the borrower with important information related to the use of stated income documentation and requires a certification regarding the amount of income.
The Rhode Island Department of Business Regulation, Division of Banking, has updated each one of the model disclosures set forth in the final version of Regulation 3. Any enforcement action related to these disclosures will cover transactions initiated or pending after June 1, 2007. To read more about the final version of Regulation 3, please read our April, 2007 issue of The Compliance Wizard.
DocMagic's Compliance Department has prepared a matrix that shows whether each state, including the District of Columbia, requires a wet settlement. A "wet settlement" means that funds and all loan conditions need to be on the table at the time of closing. A "dry settlement" means that there are no funds available at closing. Here is the matrix: Wet/Dry Settlement Matrix.
In 1989, Josie came to Document Systems, Inc. ("DSI") to proof loan documents back when loan packages were still being sent out by mail. She then left DSI and learned about different aspects of our mortgage industry, working for both American City Mortgage (now Pinnacle) and Marina Mortgage (now American Home Mortgage), and funded loans. She later came back to DSI in 2002 and is now working in the Enterprise Investor Relations Department where she assists investors as well as our Customer Service Department with various investors' programs and related issues. Josie is always active here at DSI, creating loan programs and helping customers in quick fashion. All the while, she does it with a smile and with everyone's best interest at heart.
Renee Cleary, Esq. and Melanie A. Feliciano, Esq., both Assistant General Counsel in DocMagic's Legal and Compliance Department, attended the Legal Issues and Regulatory Compliance Conference in New Orleans from May 6 to May 9, 2007. Topics covered at the Conference included Federal and state law developments, anti-abusive lending requirements, fair lending and Home Mortgage Disclosures Act (HMDA), disaster planning, nontraditional product developments, data security, privacy, Fair Credit Reporting Act (FCRA), Fair and Accurate Credit Transactions (FACTA), Real Estate Settlement Procedures Act (RESPA), Truth in Lending Act (TILA), mortgage fraud, secondary market issues, enterprise risk management, eMortgage developments, class action litigation, preemption, servicing and more.
This month DSI posts updates to the loan programs of 1st National Lending Services, ABN AMRO Mortgage Group, Inc., GE Money Bank, A Federal Savings Bank DBA WMC Mortgage, Greenpoint Mortgage Funding, Inc., U.S. Bank, N.A., UBS Investment Bank and The Winter Group 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 by visiting our Investor Updates page.
The Financial Institutions Division of the Ohio Department of Commerce has updated two (2) of its model disclosures, the Business Relationship Disclosure Notice (OHBRDN.MSC) and the High Loan to Value Disclosure - Addendum to Mortgage Loan Origination Disclosure Statement (OHHLTVD.MSC). These model disclosures may be viewed here.
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 April 2007.
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