TRID. Acceptable Broker Submissions Booklet WHSL EQUAL HOUSING LENDER MEMBER FDIC NMLS #478471

Transcription

1 TRID Acceptable Broker Submissions Booklet EQUAL HOUSING LENDER MEMBER FDIC NMLS # WHSL

2 As Fremont Bank transitions to the new Rule, our goal is to make the submission of your loan applications to us as streamlined as possible. While this booklet will assist you in complying with Fremont Bank s requirements, it does not provide complete information on the Rule. For complete information on the integrated disclosure forms, please reference the CFPB website. This booklet is based on the information available to us, however, the CFPB are issuing clarifications that may impact our processes and requirements in the future. Included Loans Closed-end consumer loan applications taken on or after 10/3/2015 Primary Residence and Second Homes Detached SFR, Attached SFR, 2-4 Units, Condos and Co-Ops Excluded Loans Home Equity Lines of Credit Investment Properties (Business Purpose) Please note that existing requirements related to QM Points and Fees tests and Higher Priced Covered Transaction tests are not being replaced by the TRID requirements. Key Definitions and Other Considerations General Business Day* As previously defined within RESPA, a day on which the lender s offices are open to the public for carrying out substantially all of its business functions. Specific Business Day* All calendar days except Sundays and the legal public holidays specified in 5U.S.C 6103(a), such as New Year s Day, the Birthday of Martin Luther King, Jr., Washington s Birthday, Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans Day, Thanksgiving Day, and Christmas Day. *Note: Fremont Bank is open for conducting business on Saturdays, therefore all references to Business _Day in this booklet includes all calendar days except Sundays and the specified legal holidays. Delivery (delivered) handed to the consumer, or placed in the mail, or sent electronically to the consumer. Received handed to the consumer, received in the mail, or received and opened electronically. If the disclosure is mailed or sent electronically, the consumer is considered to have received the disclosure three specific business days after they are mailed. Complete Application an application is considered complete when the following six (6) pieces of information are obtained: consumer s name, consumer s income, consumer s social security number, the property address, an estimate of the value of the property, and the mortgage loan amount sought. Consummation occurs when the consumer becomes contractually obligated to repay the loan; Fremont Bank considers it to be the date the consumer signs the Note. Application Receipt Fremont Bank will determine the Application Date based upon the signed E-Delivery of Disclosures and E-SIGN Compliance Disclosures may be delivered to the consumer electronically, subject to the consumers consent and in compliance with E-SIGN requirements. Specifically the broker must have the consumer s electronic consent prior to delivering the disclosures electronically. Mailbox Receipt Rule If the Loan Estimate ( LE ) is mailed or delivered electronically it is assumed that the consumer received the LE three (3) Business Days after it was delivered or placed in the mail unless there is satisfactory evidence that the consumer received it earlier.

3 LOAN ESTIMATE Loan Estimate Content Fremont Bank will review contents of the Loan Estimate to confirm completeness, accuracy and format. Refer to for specific content requirements. Delivery, Waiting Period and Imposition of Fees LE must be delivered or placed in the mail no later than the third Business Day after receiving the consumer s complete application. In a rescindable transaction, the broker must separately give the LE to each consumer who has the right to rescind. A broker may NOT impose a fee on the consumer (other than a bonafide fee for a credit report) until the LE has been received by the consumer and the consumer has indicated an intent to proceed. The broker must provide documentation of the consumer s intent to proceed in order to satisfy the record retention requirements of TILA Regulation Z. The bank currently does not require a particular method; however the documentation must sufficiently indicate the consumer s intent. The bank will not accept a signed LE to document intent to proceed. Signature and Date Lines Fremont Bank will not require that the consumer sign and date the LE. However, we will accept satisfactory evidence that the consumer received the LE earlier than the three business days after it is mailed or delivered. Accuracy of Fees Disclosed on Loan Estimate Fees disclosed on the LE should be made in good faith and consistent with the best information available at the time they were disclosed. Except for the item for Points under Origination Charges, all fees must be listed by alphabetical order. Items that are a component of title insurance must include the introductory description of Title. Any payments that have been or will be made directly by the consumer to broker must be itemized separately in the Origination Charges. Do not disclose compensation paid by the bank. Written List of Service Providers If a consumer is permitted to shop for a settlement service, the bank requires that the broker provide the consumer with a list of the services they can shop. The Written List of Service Providers is separate from the LE, but must be provided within the same timeframe, no later than three Business Days of the broker receiving the consumer s application. The Written List of Service Providers must: Identify at least one available settlement service provider for each service; and State that the consumer may choose a different provider for that service. Fremont Bank will not require inclusion of services that the consumer cannot shop for. If the consumer is not allowed to shop for any services, a Written List of Service Providers does not need to be provided. Note: Brokers may not include any affiliate service providers on their written list. Estimated and Average Fees Fremont Bank will not accept any LE submissions that contain fee Estimates designated with an (e) nor LEs where Average Fees were listed.

4 LE PAGE 3: OTHER CONSIDERATIONS Servicing Disclosure Statement Fremont Bank will require all broker LE submissions to indicate as below: Servicing We intend: to service your loan. If so, you will make your payments to us. x to transfer servicing of your loan. Assumption ARM and FHA Loans Fremont Bank will allow, under certain conditions, a subsequent purchaser of the property to assume the loan on the original terms. All Other Submissions Fremont Bank will not allow assumption of this loan. Late Payment _FHA - If your payment is more than 15 days late, we will charge a late fee of 4% of the monthly principal and interest payment. All Other Submissions If your payment is more than 15 days late, we will charge a late fee of 5% of the monthly principal and interest payment. OTHER ISSUES Below are other common issues that although are not expressly related to TRID may still cause Fremont Bank to reject a broker submission. Transfer Taxes Often these are under disclosed or not disclosed at all on packages submitted by brokers. Under TRID, Transfer Taxes must be disclosed in Section E of the Loan Estimate. As these are a zero tolerance items under TRID, any submissions with incorrect transfer taxes will continue to be rejected. Owner s Title Policy In all purchase transactions, the owner s policy is required to be listed, regardless of who pays for it. Under TRID, the Owner s Title Policy must be disclosed in Section H of the LE and labeled as (Optional). H. Other $625 Title - Owners Coverage (Optional) $625 Under Disclosed Fees The third most common occurrence that causes a rejection of a broker submission is under disclosing Fremont Bank fees. Under TRID, any fees paid to the creditor, broker, or an affiliate are subject to zero tolerance.

5 Therefore, any submissions that under disclose or understate Fremont Bank fees will be rejected. Fremont Bank will issue additional guidance concerning Appraisal Fees. Loan Submission When you send a loan file to Fremont Bank on or after October 3, 2015, the following documents must be included AT A MINIMUM: 1. Wholesale Submission Form, including the fee breakdown 2. DO/DU Findings assigned to Fremont Bank 3. Complete 1003 dated Loan Estimate within 3 days of the Written List of Service Providers If lock requested: 7. Lock Request 8. Appraisal Authorization or HVCC Appraisal EXAMPLES The following pages include examples of an FHA Purchase and an ARM Refinance. This communication does not represent legal interpretation, guidance or advice of or by Fremont Bank. While efforts have been made to ensure accurate replies to inquiries and in this communication, this is not a substitute for any regulation or rule. Only the rule and its Official Interpretations can provide complete and definitive information regarding requirements. This document does not bind Fremont Bank and does not create any rights, benefits, or defenses, substantive or procedural, that are enforceable by any party in any manner.

6 FHA PURCHASE LOAN Fremont Bank 2580b Shea Center Drive, Livermore, CA Loan Estimate DATE ISSUED 9/24/2015 APPLICANTS Marisol Testcase Main Street Anaheim, CA PROPERTY 1234 Main Street Anaheim, CA SALE PRICE $415,000 Save this Loan Estimate to compare with your Closing Disclosure. LOAN TERM 30 years PURPOSE Purchase PRODUCT Fixed Rate LOAN TYPE Conventional X FHA VA LOAN ID # UAT RATE LOCK NO X YES, until 10/8/2015 at 12:00 a.m. PDT Before closing, your interest rate, points, and lender credits can change unless you lock the interest rate. All other estimated closing costs expire on 10/6/2015 at 12:00 a.m. PDT Loan Terms Can this amount increase after closing? Loan Amount $401,912 NO Interest Rate 3.250% NO Monthly Principal & Interest See Projected Payments below for your Estimated Total Monthly Payment $1, NO Prepayment Penalty Balloon Payment Does the loan have these features? NO NO Projected Payments Payment Calculation Years 1-30 Principal & Interest $1, Mortgage Insurance Estimated Escrow Amount can increase over time Estimated Total Monthly Payment $2,501 Estimated Taxes, Insurance & Assessments Amount can increase over time $475 a month This estimate includes X Property Taxes X Homeowner's Insurance Other: In escrow? YES YES See Section G on page 2 for escrowed property costs. You must pay for other property costs separately. Costs at Closing Estimated Closing Costs $5,218 Includes $8,638 in Loan Costs + $6,065 in Other Costs -$9,485 in Lender Credits. See page 2 for details. Estimated Cash to Close $18,306 Includes Closing Costs. See Calculating Cash to Close on page 2 for details. Visit for general information and tools. Page 1 v09/22/2015

7 Closing Cost Details Loan Costs A. Origination Charges $470 % of Loan Amount (Points) Delivery Fee $25 Document Preparation Fee $50 Underwriting Fee $395 Other Costs E. Taxes and Other Government Fees $951 Recording Fees and Other Taxes $101 Transfer Taxes $850 F. Prepaids $322 Homeowner's Insurance Premium ( months) Mortgage Insurance Premium ( months) Prepaid Interest ($35.79 per day for %) $322 Property Taxes ( months) B. Services You Cannot Shop For $7,343 Appraisal Fee $425 Flood Determination Fee (Basic) $5 Mortgage Insurance Premium $6,913 G. Initial Escrow Payment at Closing $4,167 Homeowner's Insurance $91.67 per month for 12 mo. $1,100 Mortgage Insurance per month for mo. Property Taxes $ per month for 8 mo. $3,067 H. Other $625 Title - Owners Coverage (Optional) $625 I. TOTAL OTHER COSTS (E + F + G + H) $6,065 C. Services You Can Shop For $825 Title - Environmental Fee $25 Title - Lender's Coverage $625 Title - Signing Fee $175 J. TOTAL CLOSING COSTS $5,218 D + I $14,703 Lender Credits -$9,485 D. TOTAL LOAN COSTS (A + B + C) $8,638 Calculating Cash to Close Total Closing Costs (J) $5,218 Closing Costs Financed (Paid from your Loan Amount) $0 Down Payment/Funds from Borrower $13,088 Deposit $0 Funds for Borrower $0 Seller Credits $0 Adjustments and Other Credits $0 Estimated Cash to Close $18,306

8 Additional Information About This Loan LENDER Fremont Bank NMLS/CA LICENSE ID LOAN OFFICER Michael Peng NMLS/CA LICENSE ID PHONE (925) MORTGAGE BROKER Qa Broker 1.25 Comp NMLS/CA LICENSE ID LOAN OFFICER Agent 2 NMLS/CA LICENSE ID 10001/5564 michael.peng@fremontbank.com PHONE (408) Comparisons In 5 Years Use these measures to compare this loan with other loans. $129,838 Total you will have paid in principal, interest, mortgage insurance, and loan costs. $42,978 Principal you will have paid off. Annual Percentage Rate (APR) 4.042% Your costs over the loan term expressed as a rate. This is not your interest rate. Total Interest Percentage (TIP) % The total amount of interest that you will pay over the loan term as a percentage of your loan amount. Other Considerations Appraisal Assumption Homeowner's Insurance We may order an appraisal to determine the property's value and charge you for this appraisal. We will promptly give you a copy of any appraisal, even if your loan does not close. You can pay for an additional appraisal for your own use at your own cost. If you sell or transfer this property to another person, we X will allow, under certain conditions, this person to assume this loan on the original terms. will not allow assumption of this loan on the original terms. This loan requires homeowner's insurance on the property, which you may obtain from a company of your choice that we find acceptable. Late Payment If your payment is more than 15 days late, we will charge a late fee of 4% of the payment. Refinance Servicing Refinancing this loan will depend on your future financial situation, the property value, and market conditions. You may not be able to refinance this loan. We intend: to service your loan. If so, you will make your payments to us. X to transfer servicing of your loan. Confirm Receipt By signing, you are only confirming that you have received this form. You do not have to accept this loan because you have signed or received this form. Marisol Testcase Date Page 3 v09/22/2015

9 ARM REFINANCE Fremont Bank 2580b Shea Center Drive, Livermore, CA Loan Estimate DATE ISSUED 9/24/2015 APPLICANTS Marisol G. Testcase 123 Fake Street Newark, CA PROPERTY 123 Fake Street Newark, CA EST. PROP. VALUE $2,000,000 Save this Loan Estimate to compare with your Closing Disclosure. LOAN TERM 30 years PURPOSE Refinance PRODUCT 7/1 Adjustable Rate LOAN TYPE X Conventional FHA VA LOAN ID # UAT RATE LOCK X NO YES, until Before closing, your interest rate, points, and lender credits can change unless you lock the interest rate. All other estimated closing costs expire on 10/6/2015 at 12:00 a.m. PDT Loan Terms Can this amount increase after closing? Loan Amount $1,500,000 NO Interest Rate 2.875% YES Adjusts every year starting in year 8 Can go as high as 7.875% in year 10 See AIR Table on page 2 for details Monthly Principal & Interest See Projected Payments below for your Estimated Total Monthly Payment $6, YES Adjusts every year starting in year 8 Can go as high as $9,755 in year 10 Prepayment Penalty Balloon Payment Does the loan have these features? NO NO Projected Payments Payment Calculation Years 1-7 Years 8 Years 9 Years Principal & Interest $6, $5,832 min $5,832 min $5,832 min $7,575 max $9,015 max $9,755 max Mortgage Insurance Estimated Escrow Amount can increase over time + 2, , , ,167 Estimated Total Monthly Payment $8,390 $7,999 -$9,742 $7,999 -$11,182 $7,999 -$11,922 Estimated Taxes, Insurance & Assessments Amount can increase over time $900 a month This estimate includes X Property Taxes X Homeowner's Insurance Other: In escrow? YES YES See Section G on page 2 for escrowed property costs. You must pay for other property costs separately. Costs at Closing Estimated Closing Costs $53,173 Includes $38,685 in Loan Costs + $14,488 in Other Costs -$0 in Lender Credits. See page 2 for details. Estimated Cash to Close $1,446,827 Includes Closing Costs. See Calculating Cash to Close on page 2 for details. From X To Borrower Visit for general information and tools. Page 1 v09/22/2015

10 Closing Cost Details Loan Costs A. Origination Charges $36, % of Loan Amount (Points) $35,925 Delivery Fee $25 Document Preparation Fee $125 Underwriting Fee $800 Other Costs E. Taxes and Other Government Fees $910 Recording Fees and Other Taxes $60 Transfer Taxes $850 F. Prepaids $2,578 Homeowner's Insurance Premium ( months) Mortgage Insurance Premium ( months) Prepaid Interest ($ per day for %) $1,078 Property Taxes (0 months) $1,500 B. Services You Cannot Shop For $865 Appraisal Fee $800 Flood Determination Fee (Basic) $5 Tax Service Fee $60 G. Initial Escrow Payment at Closing $11,000 Homeowner's Insurance $1, per month for 11 mo. $11,000 Mortgage Insurance per month for mo. Property Taxes per month for mo. H. Other I. TOTAL OTHER COSTS (E + F + G + H) $14,488 C. Services You Can Shop For $945 Title - Lender's Coverage $450 Title - Settlement/Closing Fee $495 J. TOTAL CLOSING COSTS $53,173 D + I $53,173 Lender Credits Calculating Cash to Close Loan Amount $1,500,000 Total Closing Costs (J) -$53,173 Estimated Total Payoffs and Payments $0 Estimated Cash to Close From X To Borrower $1,446,827 D. TOTAL LOAN COSTS (A + B + C) $38,685 Estimated Closing Costs Financed (Paid from your Loan Amount) $53,173 Adjustable Interest Rate (AIR) Table Index + Margin 1 Year LIBOR % Initial Interest Rate 2.875% Minimum/Maximum Interest Rate 2.250%/7.875% Change Frequency First Change Beginning on the 84th month Subsequent Changes Every 12th month after first change Limits on Interest Rate Changes First Change 2% Subsequent Changes 2% Page 2 v09/22/2015

11 Additional Information About This Loan LENDER Fremont Bank NMLS/CA LICENSE ID LOAN OFFICER Michael Peng NMLS/CA LICENSE ID PHONE (925) MORTGAGE BROKER Mignani Abc NMLS/CA LICENSE ID LOAN OFFICER Lo Name NMLS/CA LICENSE ID PHONE (888) Comparisons In 5 Years Use these measures to compare this loan with other loans. $413,167 Total you will have paid in principal, interest, mortgage insurance, and loan costs. $169,464 Principal you will have paid off. Annual Percentage Rate (APR) 3.139% Your costs over the loan term expressed as a rate. This is not your interest rate. Total Interest Percentage (TIP) % The total amount of interest that you will pay over the loan term as a percentage of your loan amount. Other Considerations Appraisal Assumption Homeowner's Insurance We may order an appraisal to determine the property's value and charge you for this appraisal. We will promptly give you a copy of any appraisal, even if your loan does not close. You can pay for an additional appraisal for your own use at your own cost. If you sell or transfer this property to another person, we X will allow, under certain conditions, this person to assume this loan on the original terms. will not allow assumption of this loan on the original terms. This loan requires homeowner's insurance on the property, which you may obtain from a company of your choice that we find acceptable. Late Payment If your payment is more than 15 days late, we will charge a late fee of 5% of the payment. Liability after Foreclosure Refinance Servicing Taking this loan could end any state law protection you may currently have against liability for unpaid debt if your lender forecloses on your home. If you lose this protection, you may have to pay any debt remaining even after foreclosure. You may want to consult a lawyer for more information. Refinancing this loan will depend on your future financial situation, the property value, and market conditions. You may not be able to refinance this loan. We intend: to service your loan. If so, you will make your payments to us. X to transfer servicing of your loan. Confirm Receipt By signing, you are only confirming that you have received this form. You do not have to accept this loan because you have signed or received this form. Marisol G. Testcase Date Page 3 v09/22/2015