March 2009

		Vol. 7, Issue 3 (Mar 2009)

Greetings from Document Systems, Inc. ("DSI") and DocMagic®, the preeminent loan document preparation system in the mortgage lending industry. We hope you enjoy this month's issue of The Compliance Wizard, a FREE, electronic publication addressing compliance and other issues of concern to DocMagic® software users. Subscribe/Unsubscribe

IN THIS ISSUE ...

Update to FHA Loans and TIL Prepayment Penalty Disclosures

RESPA Reform: Revised GFE – Page 2

Interim/Processing Disclosures and Forms (Forms List) Available Now

Pre-Closing Package Available Now

Investor Updates - March 2009

At Your Service: Colorado Dual Status Disclosure

New/Revised Documents - March 2009

U.S. Treasury Yields - March 2009

Update to FHA Loans and TIL Prepayment Penalty Disclosures

In a letter to HUD Secretary Shaun Donovan dated September 29, 2009, the Federal Reserve Board has reversed its position with respect to the prepayments on FHA loans. Prior to the date of this letter, the staff of the Division of Consumer and Community Affairs of the Federal Reserve Board (the group responsible for issuing official interpretations of Regulation Z) took the position that interest charged on an FHA loan for prepayments made other than on a regularly scheduled payment due date from the date of prepayment until the next installment due date should be treated as a prepayment penalty for disclosure purposes.

RESPA Reform: Revised GFE – Page 2

Written by Richard Triplett, CMB*

In keeping with the previous articles written on general RESPA reform and page 1 of the revised GFE, this article will cover certainly one of the most controversial aspects of the revised GFE: Page 2. Due to the overwhelming effect this will have on mortgage brokers, lenders, and all third party providers of services, it is the primary reason for threatened law suits to prevent the final rule.

Interim/Processing Disclosures and Forms (Forms List) Available Now

As a lender or broker, have you ever wished that you could select from a list of forms and disclosures that contains, for example, a Uniform Underwriting and Transmittal Summary (Form 1008), Verification of Deposit (1006), Verification of Employment (1005), and Statement of Credit Denial, that you would like to provide to the borrower at a point in the loan process between application and closing. Well, dream no more!

Pre-Closing Package Available Now

DocMagic, Inc. is pleased to formally announce that pre-closing packages are now available in the DocMagic software. This package type became available as of Tuesday, March 3, 2009. For more details about DocMagic's pre-closing package, please refer to this recent article.

Investor Updates - March 2009

This month DSI posts updates to the loan program of GMAC 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 by visiting our Investor Updates page.

At Your Service: Colorado Dual Status Disclosure

Effective March 2, 2009, the Colorado Division of Real Estate requires use of their model form, Dual Status Disclosure ("Disclosure"), if a licensed mortgage broker is also licensed as a real estate broker pursuant to 4 CCR 725-3, Rule 7-1-1. In accordance with Rule 7-1-1, the Disclosure also discloses whether the individual is also acting as a mortgage broker and real estate broker on the same transaction.

New/Revised Documents - March 2009

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 February, 2009.

U.S. Treasury Yields - March 2009

The U.S. Treasury security yield values for March 2009 may be viewed online here. The yield is determined as of the 15th day of the month immediately preceding the month in which the creditor receives the application. The yield value is used for Section 32 and most state high-cost tests. These values will, therefore, be used for loan applications received by the creditor in April 2009.

Industry-Related Announcements/Newsletters – March 2009

To view this month's list of announcements or newsletters related to our mortgage industry, please click here.