Tolerance Cures: Guide to getting it right

Transcription

1 Tolerance Cures: Guide to getting it right

2 1. Wrong appraisal fee disclosed (incorrect product selected) After reviewing the File Data tab click on the continue button, this will move you to the Questions tab: select the blue link next to the: Appraisal Product Name and chose from the drop down list

3 Most commonly used: 1004 Uniform Residential Appraisal Report; owner occupied single family residence FNMA Small Residential Income Property Report; multi family, investment Land Appraisal; land only 1073 Individual Condo Appraisal Report When you select the applied to the 2015 Itemization: button within Smart GFE, the appropriate fee will be NOTE: To cross reference the applied fee to ValueQuest s fee schedule please review their posted fee schedule on the Freshdesk: 2. Not disclosing a final inspection fee The Underwriter (UW) will initiate the final inspection fee upon review of the Appraisal Report (if applicable). The UW will complete the Change of Circumstance (COC) section on page 1 of the Loan Estimate (LE) as follows: NOTE: The re-disclosure must be performed within 3 business days of the date the change was discovered to be within compliance.

4 The UW will populate the 2015 Itemization with the Final Inspection Fee.

5 NOTE: This will be a manual entry by the UW. The LP upon review and prior to re-disclosure to the borrower(s) will re-run Smart GFE and select the appropriate fee name to re-export into Encompass. The Loan Processor (LP) will be alerted to review the COC request and complete the redisclosure. 3. Transfer Tax not being disclosed properly Note: It is important to re-run Smart GFE at initial disclosure and at each COC thereafter. Smart GFE was initially set up to run a clear statue in regard to Transfer Taxes. This will apply the transfer taxes based on the state statue if it is clearly defined. If the state statue is not clear Smart GFE will default to full borrower paid, which is the most conservative option. In the event that the Purchase and Sales Contract states how the transfer taxes should be applied the LP would select EDIT TAX to apply the fee accordingly OR apply the transfer tax fee directly on the 2015 itemization prior to disclosure. Examples: Short Sales, Government owned properties or Seller/Buyer negotiated transactions could potentially require a manual split tax entry or full borrower paid tax. NOTE: In the fee detail window if the transfer tax split includes the seller the box Seller obligated should be checked NOT seller credit. Example: Connecticut loans.

6 4. Survey fee not being disclosed If a loan requires a land survey (state regulated or Attorney recommended) or is requested by the borrower(s) the fee and provider needs to be disclosed on both the LE and CD once determined. NOTE: IF discovered after initial disclosure, the re-disclosure must be performed within 3 business days of the date the change was discovered to be within compliance. If the LP is aware at initial disclosure when running Smart GFE the LP will select Add Additional Services and select Land Survey from the drop down.

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8 If the Survey requirement is determined at preliminary CD depending on the timing the LP will re-disclose the LE with the additional fee, or the Closer will disclose the fee on the initial CD. 5. VA unallowable fees being disclosed VA Loans have allowable and unallowable fees. Please review this information on the Freshdesk: Prior to disclosure the LP will Run Smart GFE Preview Mavent Review the 2015 itemization for fee placement Make changes as applicable Q: What steps should the LP take prior to disclosure if there are unallowable fees on the itemization? A: If there are unallowable fees in section 1100: Title Charges Settlement Fee; split in half and add the amounts to the Title Search and Exam Fee line items Junk fees will need to be removed completely o Any Attorney fees that are not title related: Assignment Fees, Copy Fee, Tax Service Fee etc. 6. Lender credits being applied incorrectly NOTE: Lender credits should not be reflected on the details of transaction (DOT). If a loan file is submitted into Processing with these fees prior to disclosure please make sure they are removed.

9 On the 2015 itemization Secondary will place a lender credit in the Lender Paid Originator Compensation section based on the interest rate credit given, this should only be done in the instance of a locked loan. Any time the rate changes or an extension is given this credit can change and a COC will need to be done. NOTE: The re-disclosure must be performed within 3 business days of the date the change was discovered to be within compliance. NOTE: Retail Loan transactions should not have any portion of the lender credit allocated to a specific fee. Lender credits, under TRID, are subject to 0 tolerance and can only increase never decrease.