Compliance Town Hall Getting Ready for Release

Transcription

1 Compliance Town Hall Getting Ready for Release Eleanor Hopkins, NCCO Product Manager, Compliance June 27, 2017

2 Enhancement dates contained in this document are provided as estimates only and can be changed at any time at the sole discretion of Jack Henry & Associates, Inc. 2

3 Speaker Information Eleanor Hopkins, NCCO Episys Product Manager, Compliance Symitar, a Jack Henry & Associates Company (619) ehopkins@jackhenry.com 3

4 Agenda Release Enhancements Amendments to the 2013 Mortgage Loan Servicing Rules (part 2) HMDA MLA Release Resources Product Announcements Hot Topics Questions 4

5 Amendments to the 2013 Mortgage Servicing Rules

6 Regulatory Requirements - Overview Amendments to the 2013 Mortgage Servicing Rules The CFPB issued the rules to make technical corrections, clarifications, revisions and amendments to the 2013 rules: Force placed insurance notices Early intervention Loss mitigation Periodic statement Mortgages in bankruptcy, successor in interest, cease communication requests Effective: October 19, 2017 & April 19, 2018 Impact to Episys: Amendments to the 2013 Mortgage Servicing Rules enhancement, Release , &

7 Episys Enhancement - Overview Amendments to the 2013 Mortgage Servicing Rules Updates to mortgage statements that will be effective on 10/19/17, that allow you to do the following: Generate a final charge-off statement Store the last date that Episys sent an early Intervention Notice Provide for temporary loss mitigation payments Provide for an acceleration amount and include the acceleration amount on the statement Display new messages to statement sections 7

8 Regulatory Requirements Charge Offs Final Charge Off Statement (e)(6)(i)(B) Your credit union must continue to send the Periodic Statement for a loan that has been charged off until: The mortgage has been charged off No further fees or interest charged Send a Final Periodic Statement within 30 days of charge off or the most recent periodic statement 8

9 Episys Enhancement Charge Offs Final Charge Off Statement To generate the Final Charge Off Statement: Update Parameter Manager: Statement Messages Update new Loan record fields: Enter the correct date in the Final Charge Off Date field Set the Send Final Charge Off Stmt field to (1) Yes 9

10 Episys Enhancement - Charge Offs 10

11 Regulatory Requirement Early Intervention Early Intervention Notice CFR You must, establish or make good faith efforts to establish live contact with borrowers by the 36th day of delinquency and promptly inform them of loss mitigation options that may be available. In addition, you must, provide borrowers with written information about any available loss mitigation options by the 45th day of delinquency. 11

12 Episys Enhancement Early Intervention Early Intervention Notice To track the last time you sent an Early Intervention Notice update the: Early Intervention Notice Date field 12

13 Regulatory Requirement - Temp Loss Mit Temporary Loss Mitigation (d)(1) in temporary loss mitigation, the statement may display either the payment due under the temporary loss mitigation program or the amount due according to the loan contract. If the amount due identifies the payment due under the temporary loss mitigation program, then the explanation of amount due under (d)(2) must include both the amount due according to the loan contract and the payment due under the temporary loss mitigation I(1)(i)-4 treat payments received under a temporary loss mitigation program as a partial payment. 13

14 Episys Enhancement - Temp Loss Mit Temporary Loss Mitigation To track loss mitigation payments as partial payments and generate a Temporary Loss Mitigation Statement, update the: New Loan Record fields Loss Mit Effective Date Loss Mit Ex Date Loss Mit Stmt Msg Code Temp Loss Mit Payment Temp Loss Mit Pmt Stmt Msg Code New Statement Message parameters 14

15 Episys Enhancement Temp Loss Mit Temporary Loss Mitigation Programs 15

16 Episys Enhancement Temp Loss Mit 16

17 Regulatory Requirement Acceleration Loan Acceleration (d)(2) If the balance of a mortgage loan has been accelerated, but your credit union will accept a lesser amount to reinstate the loan include both the reinstatement amount as the amount due and the accelerated amount. 17

18 Episys Enhancement Acceleration Loan Acceleration To create a statement with loan acceleration info update the New Loan Record fields Acceleration Good Thru Date Acceleration Amount Acceleration Stmt Msg Code Reinstatement Amount Parameter Manager - Statement Messages: Set up a message for loans in acceleration status 18

19 Episys Enhancement Acceleration 19

20 Episys Enhancement Loan Acceleration 20

21 Regulatory Requirement Close Proximity Close Proximity New Statement Messages (d) statement disclosures must be in close proximity to one another, and set off from other groupings Text between the sections must either or explain or expand upon required disclosures. 21

22 Episys Enhancement Close Proximity Close Proximity New Statement Messages To add intervening text in your statement use the new Periodic Mtg Criteria Parameters to define Loan Statement Notes 22

23 Episys Enhancement Close Proximity 23

24 Home Mortgage Disclosure Act

25 Regulatory Requirement Overview Home Mortgage Disclosure Act Expands data collection requirements to include additional loan types and more borrower information. Larger servicers will be required to report HMDA data quarterly. A new webbased submission tool for reporting HMDA data is under development. Effective: 2018 data begin reporting in 2019 Impact to Episys: HMDA Reporting Modifications enhancement, Release HMDA Universal Loan Identifier Creation and Storage, Release

26 Episys Enhancement Overview Home Mortgage Disclosure Act The HMDA Reporting Modifications enhancement provides new fields in for data to be gathered starting 1/1/2018: Application Record 79 fields Application Person Record 22 fields Miscellaneous Parameters 1 field 26

27 Episys Enhancement Application Record 27

28 Regulatory Requirement ULI Universal Loan Identifier HMDA requires a special unique Universal Loan Identifier on each mortgage loan application, comprised of: Your financial institution s Legal Entity Identifier 23 unique characters Two character check digit 28

29 Episys Enhancement ULI Universal Loan Identifier HMDA requires a special unique Universal Loan Identifier on each mortgage loan application, comprised of: Your financial institution s Legal Entity Identifier New field in Misc Parameters ( ) 23 unique characters Logic to generate a unique number ( ) Two character check digit Logic based on ISO standards coming in Application Record contains two fields for ULI; additional fields for storing on the Loan record coming in

30 Episys Enhancement ULI Legal Entity Identifier 30

31 Episys Enhancement HMDA ELA Enhanced Lending Application ELA Updates: Gathering Data Reporting Data HMDA Data Entry Screen: Standalone solution to gather data, if you have an alternate lending application solution Includes a PowerOn for reporting Targeted availability: fall 2017 Note: RB.HMDA.APP will be updated to support pipedelimited format in

32 Episys Enhancement - ELA 32

33 Military Lending Act

34 Regulatory Requirement Overview Military Lending Act Expansion Credit cap of 36% expanded to include: payday loans, deposit advance products, auto title and installment loans. Credit cap excludes: residential mortgages, motor vehicle loans secured by the vehicle being purchased, or other loan secured by property being purchased. Military APR modified to include certain fees as part of the calculation; qualified credit card (a.k.a. bona-fide fees) are different than for other loan products. The effective dates for this regulation are: 10/3/2016 for open and closed loans 10/3/2017 for credit cards may be extended again 34

35 Military Lending Act Timeline Part Description Effective Solution Open-End Closed-End Covered Borrower Calculate 36% threshold exceeded at end of billing cycle. Reverse fees or lower insterest as necessary. Calculate 36% threshold exceeded at loan consummation. Reverse fees or lower interest as necessary. Determine borrower s status via 1. MLA database 2. Consumer Reporting Agency Credit Cards Open End (above) + bona-fide & reasonable fees 10/3/16 Rate Cap for Military APR (R ) Rate Cap for Military APR (Part 3) (R ) ELA Update 10/3/16 Above + Dfct Fix (9/26/16) 10/3/16 DoD MLA Database Directly through CRA Or Credit Retrieval - Military Lending Act of 2016 (NovSP) 10/3/17 Credit Card MAPR Cap (R ) 35

36 Military Lending Act Timeline 2016 June R Sept Oct MLA Open/Closed Loans Nov Dec R Rate Cap for Military APR Dfct fix ELA update Credit Retrieval - Military Lending Act of 2016 Feb June R August Oct MLA Credit Cards Dec R Rate Credit Cap for Card Military MAPR APR CAP Part 3 ELA Update 36

37 Military Lending Act Open & Closed End Loans Effective 10/3/2016

38 Episys Enhancement Overview Military Lending Act Expansion Open and Closed End Loans (effective 10/3/2016) Episys enhancements delivered in 2016: Rate Cap for Military APR (R ) ELA Updates (fall 2016) Credit Retrieval - Military Lending Act of 2016 (R ) Episys enhancements delivered in 2017: Rate Cap For Military APR (Part 3) (R ) ELA Updates (summer 2017) 38

39 Episys Enhancement MLA Overview Rate Cap for Military APR (Part 3) Adds Military APR fields to Application Person and Application records Updates interest calculation for open end loans that are not daily billed Updates interest calculation for closed-end loans for 360 Actual interest and level principal payments Updates Loan Projections to calculate MAPR for closedend loans Provides specfile access to Loan Projections for MAPR calculations on closed end loans 39

40 Episys Enhancement MLA Rate Cap for Military APR (Part 3) During loan application, it will now be easier to capture the members MLA status, by updating: New fields in Application Area: Active Duty Active Duty Verification Date Active Duty Start Date Active Duty Separation Date 40

41 Episys Enhancement - MLA Rate Cap for Military APR (Part 3) Updated MAPR calc logic: Int Calc on open-end not daily billed loans. Support for closed-end loans on 360 Act., daily billed, and level principle payments 41

42 Episys Enhancement MLA Rate Cap for Military APR (Part 3) To use updated interest calcs use the new field MAPR Current Stmt Int Accrue originally interest was off by one day for open end not daily billed Loan Projections Now supports calculations for closed end loans on 360 Actual Interest, daily billed and level principal 42

43 Episys Enhancement MLA Rate Cap for Military APR (Part 3) Updates Loan Projections so that you can now calculate the MAPR for closed-end loans Closed End loans only require a one time MAPR calculation at consummation of credit If you have the ELA product, it will now call Loan Projections for a closed end calculation. 43

44 Episys Enhancement MLA ELA Rate Cap for Military APR (Part 3) ELA Applicant Screen Information regarding military service ELA Projection Screen Designate an application as a MAPR loan Call the MAPR calculation screen If calculated, this value will be stored in a tracking record Military APR Calculation Screen Specfile PS.CALCULATE.LOANAPP.MAPR Run independently or call from another specfile Supports MAPR Calcs for most loan types Can create a MAPR tracking record 44

45 Military Lending Act Credit Card Loans Effective 10/3/2017

46 Regulatory Requirements MLA Military Lending Act Credit Cards Calculating the MAPR for credit cards uses the same fees included in the finance charge for other types of credit. However, certain fees may be excluded if they are bona fide and reasonable. The regulation provides a safe harbor (can be excluded) if the fee is equal to or less than the average of the amount charged by five (5) other credit card issuers of sufficient size (more than $3 billion outstanding in credit card loans) for a like-kind fee. If any fee is not a bona fide fee, all fees (including bona fide fees) must be included in the MAPR calculation. 32 CFR 232.4(d)(4)(ii). 46

47 Regulatory Requirement MLA Cards Military Lending Act Credit Cards Bonafide determination Compare it to similar fees typically imposed by other creditors for the same or a substantially similar product or service. The following are not considered bona fide: credit insurance premiums, debt cancellation or debt suspension fees, and charges for credit-related ancillary products sold in connection with a credit card account Reasonable determination A fee may be reasonable if the amount reasonably corresponds to: The credit limit in effect or credit made available when the fee is imposed; The services offered under the account; or Other factors relating to the account. 47

48 Episys Enhancement MLA Cards Military Lending Act Credit Cards Updates Episys to support the 36% rate cap for Credit Cards; overview: 1. Calc MAPR for credit card loans 2. Solution to address bonafide fees 3. Ability to include/exclude fee types in the calculation 4. Support calculations when there are multiple balances (e.g. cash advance, balance transfer, purchases) 5. MAPR credit card reports 6. PowerOn Specfile access to MAPR form application record (e.g. ELA access) 48

49 Episys Enhancement MLA Cards Military Lending Act Credit Cards Determine if any fees are not bonafide and reasonable Misc Parameters MAPR Non Bonafide Fee Types These are always included in MAPR MAPR Credit Card Fee Types These are always included in MAPR IF a fee is NOT included in these parameters they will not be included in the MAPR calc. 49

50 Episys Enhancement MLA Cards Military Lending Act Credit Cards Identify Fees for cash advance, balance transfers and promotions are to be included in the MAPR calculation. Interest Type Parameters Cash Adv Tran Fee Code Balance Xfr Tran Fee Code New Teller Tran Fee Types Annual Fee Statement Replacement Fee Card Replacement Fee Cash Advance Finance Charge Fee Balance Transfer Finance Charge Fee Credit Card Non Bona Fide Fee 50

51 Episys Enhancement MLA Cards Military Lending Act Credit Cards You will need to check MAPR on open-end loans before the end of a billing cycle; reverse fees that cause MAPR to exceed 36% threshold. RB.LOAN.CALCULATE.MAPR changes: New prompt to calc MAPR on: credit card loans, all open end loans or open end non-credit card loans New reports: Credit Card Military Loans Within APR and Credit Card Military Loans Exceeding APR Calculation changes: Now supports multiple balances common with credit cards Now supports: include all bonafide if any are not bonafide and nnone if all are bonafide 51

52 Episys Enhancement MLA Cards Military Lending Act Credit Cards Sample report - Credit Card Loans within APR 52

53 Release Resources

54 Release Resources Resource Detail Where to find it? Release Documentation Project Information Projects Client Guides Enhancement executive summaries, release load and testing instructions and more! Release enhancements, detailed documentation and test instructions. Detailed information on configurations for new projects and products. For Clients > Products & Services > Core Solution > Episys > Release Information For Clients > Products & Services > Core Solution > Episys > Release Information For Clients > Products & Services > Core Solution > Episys > Rele ase Information 54

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56 Release Documentation 56

57 Release Documentation What s New 57

58 Projects 58

59 Projects 59

60 Finding the Client Guides 60

61 Finding the Client Guides 61

62 Finding the Client Guides 62

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65 Enhancements

66 Enhancements Amendments to the 2013 Mortgage Rules: Statements, DQ, and Formatting Rate Cap for Military APR Part 3 Credit Card MAPR Cap HMDA Reporting Modifications 66

67 Enhancements Amendments to the 2013 Mortgage Rules: Statements, DQ, and Formatting SBA 1502 Reporting Enhancement FinCEN Customer Due Diligence 2017 IRS Reporting Changes 67

68 Amendments to the 2013 Mortgage Rules: Statements, DQ, and Formatting Bankruptcy Bankruptcy statements model forms H-30(E) BK 7 or 11 H-30(F) BK 12 or 13 Successor in Interest New name type: Successor in Interest Ability to send statement and notices to the successor in interest Successor in interest version of statements and notices with neutral borrower language 68

69 FinCEN Customer Due Diligence Provide the ability to indicate Beneficial Ownership types and percent ownership associated with a legal entity account. Store Beneficial Owner type: Owner Control Both Ability to document beneficial owner for a non-signer/ transactor on the account Store Beneficial Owner percentage Store Legal Entity Identifier for the Bene Owner 69

70 Enhancements TCPA Tracking Remove OFAC PowerOns from the Core NACHA IAT Date of Birth Next Rate Change Date Modification Stop ACH Posting for OFAC Matches 70

71 Product Announcements

72 OFAC PowerOns End of Support 12/31/17 72

73 OFAC PowerOns End of Support 12/31/17 Bridger Insight XG SLA Integration and phase out SLA End of support for OFAC specfiles OFAC specfiles pulled from Episys February 2016 August 2016 December 2017 Release Shop for a new solution: June 2017 December 2017 Let your CRM know your plans! 73

74 Episys Identity and Sanctions Screening Integration The Symitar product Episys Identity and Sanction Screening Integration provides integration with sanction screening tools such as the LexisNexis Bridger Insight XG product. Provides a new interface to third-party watch lists and identity score services Provides Sanction Screening Extracts, for batch screening 74

75 Episys Identity and Sanctions Screening Integration Please Contact: If you have any questions about the Episys Identity and Sanctions Screening Integration or LexisNexis OFAC Bridger Insight XG products, please the Symitar Inside Sales Team at Resources: Episys Now 75

76 Hot Topics

77 Hot Topics Equifax pulling MLA status on joint accounts Interim: pull separate reports for each individual Solution: a defect ( ) fix is in the works, and will be available in an upcoming service pack Furnisher Data Reporting Requirements, effective 9/15/17 Data furnishers subject to minimum reporting for PII Full date of birth required for new authorized users Fedwire Funds Service ISO Standards Not expected to be effective until around

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79 2017 SEC Highlights 145 educational and training sessions, several preconference classes and product demonstrations Held August 28 th -31 st Hilton San Diego Bayfront Fun networking opportunities with your credit union peers! Compliance SEC Sessions: ProfitStars Financial Performance Suite: CECL, Member Profitability, and Pricing Updating Your OFAC Solution Lending Compliance: HMDA, MLA, and Servicing Rules Oh My! 79

80 Contact Eleanor Hopkins Episys Product Manager, Compliance Symitar, a Jack Henry & Associates Company (619) ehopkins@jackhenry.com 80

81 Do you have any questions?