Diane Evans, NTP President American Land Title Association Enter - - PowerPoint PPT Presentation
NEW PARADIGM TO CLOSINGS Title Industry Prepares Diane Evans, NTP President American Land Title Association Enter Congress Sweeping overhaul of the United States financial regulatory system, a transformation on a scale not seen since the
NEW PARADIGM TO CLOSINGS Title Industry Prepares
Major Components
Council
and derivative markets
Protection Bureau
“Sweeping overhaul of the United States financial regulatory system, a transformation on a scale not seen since the reforms that followed the Great Depression.“ – President Barack Obama
Purpose: “Protect consumers by carrying out Federal consumer financial laws.”
– Improved consumer understanding
– Better comparison shopping
– Avoiding costly surprises at the closing table
CFBP Complaint Process Complaint Portal on www.consumerfinance.gov Homepage
and three-page GFE
– Who provides?
mortgage broker
– When?
application
– Still subject to tolerances
settlement services when they:
– Inform borrowers on Loan Estimate – Provide them with a written list of settlement service providers
– The fee is still included in the bucket of costs subject to a 10% tolerance. – Unless the chosen provider is affiliated with the creditor (0% tolerance)
providers.
– Example: Provider must be licensed
consumer a written list of potential providers for each service.
– At least one available provider of that service – Include a clear statement that the consumer may choose a different provider for that service – Provide sufficient information for the consumer to contact an identified provider such as the name under which the provider does business and the provider's address and telephone number.
settlement service providers that are no longer in business or that do not provide services where the consumer or property is located.
– Three Day Rule – Who will provide the Closing Disclosure – Standard vs. Model form – Consumer Shopping – Disclosure of Title Fees – “Optional” owner’s title insurance
and provide Closing Disclosure.
– “The final rule acknowledges settlement agents’ longstanding involvement in the closing of real estate and mortgage loan transactions, as well as their preparation and delivery of the HUD-1. The final rule avoids creating uncertainty regarding the role of settlement agents.”
– and liability – for ensuring that the disclosure is provided in accordance with the rule.
figures to
Lender and settlement agent agree to divide responsibility for gathering data for the closing disclosure
Policy: Consumers must receive their Closing Disclosure at least three business days before closing .
– Business day = Every day but Sundays and Federal Holidays
Proposal: Must re-disclose and restart three business day clock if something changes. Some limited exceptions. Final: Only have to re-disclose and restart clock in limited circumstances.
– APR changes – Product changes – Addition of prepayment penalty
– Only if they have a Bona-Fide Personal Financial Emergency – Very fact intensive – Consumer must provide a written statement for the explaining the need for the waiver.
– The imminent sale of the consumer’s home at foreclosure
– Services you can shop for category – How to calculate: Full premium without any adjustment that might be made for the simultaneous purchase of an owner’s title insurance policy. – Can use enhanced policy or endorsements if the lender knows that these products will be purchased.
– Other category – Must be listed as “optional” – How to calculate: Full owner’s title insurance premium, adding the simultaneous issuance premium for the lender’s coverage, and then deducting the full premium for lender’s coverage.
– In case of privacy concerns – Includes only information relevant to seller – Model H-25(i)
delivery and the time frames.
and that this is info that needs to be provided to the lenders well before the closing date.
– Documentation checklists – Review of closing instructions – Final closing package/documentation
period following closing the creditor/settlement agent shall deliver or place in the mail corrected disclosures not later than 30 days after receiving information sufficient to determine inaccuracy
standard
– Standard expectations for lenders – Standard requests/process for title companies
– Industry solution that can easily change to meet market demands
– Designed to be achievable for title companies, settlement companies and lenders of all sizes
Accounts – Reconciliation
Confidential Customer Information and Trust Accounts
Remittance
reference only, and is not intended to represent the only approach to any particular issue. This information should not be construed as legal, financial or business advice, and users should consult legal counsel and subject-matter experts to be sure that the policies adopted and implemented meet the requirements unique to your company.