26032605, 2607, 2609, 2617, 5512, 5532, 5581. (e) Recordkeeping. These activities include: The CHARM booklet outlines the features and risks of adjustable rate mortgages. When we asked consumers about our new toolkit and whether they thought it was understandable and useful, almost all of them told us they liked the new toolkit. The servicer must use the escrow account analysis to determine whether a surplus, shortage, or deficiency exists and must make any adjustments to the account pursuant to paragraph (f) of this section. The servicer may include the initial escrow account statement in the basic text or may attach the initial escrow account statement as an additional page to the HUD1 or HUD1A settlement statement. A request to the Bureau for approval of any changes other than the permissible changes specified in paragraphs (d)(2) and (3) of this section shall be submitted in writing to the address indicated in the definition of Public Guidance Documents in 1024.2, stating the reasons why the applicant believes such changes, deletions, or additions are necessary. (3) The amounts charged for all other settlement services included on the GFE may change at settlement. Search & Navigation Regulation Y 26032605, 2607, 2609, 2617, 5512, 5532, 5581. The special information booklet may not be made a part of a larger document for purposes of distribution under RESPA and this section. 03/31/2015 at 8:45 am. If the servicer does not incorporate the initial escrow account statement into the HUD1 or HUD1A settlement statement, then the servicer shall submit the initial escrow account statement to the borrower as a separate document. information or personal data. The brochure, What You Should Know About Home Equity Lines of Credit, covers the features and risks of HELOCs. (c) Reproduction. If the interest rate has not been locked, or a locked interest rate has expired, the charge or credit for the interest rate chosen, the adjusted origination charges, per diem interest, and loan terms related to the interest rate may change. will also bring you to search results. Nothing in this section shall be interpreted to require a loan originator to make a loan to a particular borrower. The CFPB has issuedan updated version of the home buying information booklet(also known as the special information or settlement cost booklet) required under RESPA and TILA. The revised GFE may increase charges for services listed on the GFE only to the extent that the changed circumstances actually resulted in higher charges. (3) Subsequent escrow account analyses. This is only an estimate and the actual charges may differ. (ii) The servicer may conduct an escrow account analysis at other times during the escrow computation year. Before establishing an escrow account, the servicer must conduct an escrow account analysis to determine the amount the borrower must deposit into the escrow account (subject to the limitations of paragraph (c)(1)(i) of this section), and the amount of the borrower's periodic payments into the escrow account (subject to the limitations of paragraph (c)(1)(ii) of this section). The disclosures in that model format may be combined with or included in the Initial Escrow Account Statement required in 1024.17(g). Upon completing an escrow account analysis, the servicer must prepare and submit an annual escrow account statement to the borrower, as set forth in paragraph (i) of this section. 2602(8)). The GFE form is set out in appendix C to this part. (3) The special information booklet may be translated into languages other than English. CalCareers For example, appropriate entries include: county taxes, hazard insurance, condominium dues, etc. (1) Creditor to provide special information booklet. (2) The cover of the booklet may be in any form and may contain any drawings, pictures, or artwork, provided that the words settlement costs are used in the title. (1) Except as provided in paragraph (f) of this section, the actual charges at settlement may not exceed the amounts included on the GFE for: (ii) While the borrower's interest rate is locked, the credit or charge for the interest rate chosen; (iii) While the borrower's interest rate is locked, the adjusted origination charge; and. Special Information Booklet - Contains consumer information regarding various real estate settlement services (Required for purchase transactions only) - Can be reproduced in almost any form but Cannot be included as part of other documents or provided online 2617(a)), the Bureau may issue a revised or separate special information booklet that deals with these transactions, or the Bureau may choose to endorse the forms or booklets of other Federal agencies. (a) Use by settlement agent. Pressing enter in the search box (5) The lender may at any time collect from the loan applicant any information that it requires in addition to the required application information. (ii) Where the new servicer retains the monthly payments and accounting method used by the transferor servicer, then the new servicer may continue to use the escrow account computation year established by the transferor servicer or may choose to establish a different computation year using a short-year statement. (i) Effect of short year statement. Advertisers and sponsors are not responsible for site content. that agencies use to create their documents. A word about Medicaid Medicaid and Medicare are 2 different programs. The cushion is two months of the borrower's escrow payments to the servicer or a lesser amount specified by state law or the mortgage document (net of any increases or decreases because of prior year shortages or surpluses, respectively). Shop with several lenders. by the Consumer Financial Services Group at Ballard Spahr LLP. Where the terms of any such documents allow greater payments to an escrow account than allowed by this section, then this section controls the applicable limits. All other charges and terms must remain the same as on the original GFE, except as otherwise provided in paragraph (f) of this section. The Your Home Loan Toolkit is the special information booklet required by Regulation X, 12 CFR 1024.6 and Regulation Z, 12 CFR 1026.19(g). A violation of any of the requirements of this section will be deemed to be a violation of section 4 of RESPA. [76 FR 78981, Dec. 20, 2011, as amended at 78 FR 10875, Feb. 14, 2013; 81 FR 72370, Oct. 19, 2016]. The servicer may deliver the annual escrow account statement to the borrower with other statements or materials, including the Substitute 1098, which is provided for Federal income tax purposes. Register documents. Your Home Loan Toolkit is a resource we revised to help make the mortgage process more understandable. Disclosure time frames TRID charm booklet, a. (viii) If applicable, the reason(s) why the estimated low monthly balance was not reached, as indicated by noting differences between the most recent account history and last year's projection. 12 U.S.C. Regulation X and provisions of RESPA are enforced by Consumer Finance Protection Bureau (CFPB). Under 12 U.S.C. [76 FR 78981, Dec. 20, 2011, as amended at 81 FR 72370, Oct. 19, 2016]. user convenience only and is not intended to alter agency intent PDF Revised Special Information Booklet under New RESPA Rules - BAI 3500.5 Coverage of RESPA. 1024.6 Special information booklet at time of loan application. (1) If the terms of any federally related mortgage loan require the borrower to make payments to an escrow account, the servicer must pay the disbursements in a timely manner, that is, on or before the deadline to avoid a penalty, as long as the borrower's payment is not more than 30 days overdue. Appendix E to this part illustrates these steps. (3) The lender is not required to provide the applicant with a GFE if, before the end of the 3-business-day period: (i) The lender denies the application; or. 2604(a). The special information booklet may be reproduced in any form, . The definition encompasses any account established for this purpose, including a trust account, reserve account, impound account, or other term in different localities. (iii) Short year statement upon loan payoff. Please see the Special Requirements section for SOQ instructions. (The statutory exemption restated in this paragraph refers only to fee divisions within real estate brokerage arrangements when all parties are acting in a real estate brokerage capacity, and has no applicability to any fee arrangements between real estate brokers and mortgage brokers or between mortgage brokers. Question: Is the Special Information Booklet (Reg X) required on refinances with a different lender? Nor may the prohibitions of this part be avoided by creating an arrangement wherein the purchaser of services splits the fee. (A) When inability exists. Get started looking through tools and information about products and services we regulate. Except as provided in paragraph (k)(5)(iii) of this section, with respect to a borrower whose mortgage payment is more than 30 days overdue, but who has established an escrow account for the payment for hazard insurance, as defined in 1024.31, a servicer may not purchase force-placed insurance, as that term is defined in 1024.37(a), unless a servicer is unable to disburse funds from the borrower's escrow account to ensure that the borrower's hazard insurance premium charges are paid in a timely manner. If changed circumstances result in a change in the borrower's eligibility for the specific loan terms identified in the GFE, the loan originator may provide a revised GFE to the borrower. If you are having an issue with your mortgage, reach out to a HUD-approved housing counseling agency. This contact form is only for website help or website suggestions. The lender may, at its option, charge a fee limited to the cost of a credit report. We also have a version in Spanish . electronic version on GPOs govinfo.gov. While every effort has been made to ensure that (6) Restrictions on pre-accrual. or existing codification. The TILA-RESPA rule includes some new restrictions on certain activity prior to a consumer's receipt of the Loan Estimate. For a disclosure is the special Information booklet required? (B) Bona fide business loans, advances, and capital or equity contributions between entities in an affiliate relationship (in any direction), are not prohibitedso long as they are for ordinary business purposes and are not fees for the referral of settlement service business or unearned fees. (b) Delivery. If a borrower uses a mortgage broker, the mortgage broker shall distribute the special information booklet and the lender need not do so. The value of a referral (i.e., the value of any additional business obtained thereby) is not to be taken into account in determining whether the payment exceeds the reasonable value of such goods, facilities or services. 1024.8 Use of HUD1 or HUD1A settlement statements. (i) The average charge for a settlement service shall be no more than the average amount paid for a settlement service by one settlement service provider to another settlement service provider on behalf of borrowers and sellers for a particular class of transactions involving federally related mortgage loans. The intent of this provision is that the applicant receive the special information booklet at the earliest possible date. If you would like to comment on the current content, please use the 'Content Feedback' button below for instructions on contacting the issuing agency. This pre-filing registration requirement is being submitted to OMB and will be processed in accordance with the PRA as required by 5 CFR 1320.10. Instead, the Bureau has provided a link in the Booklet to a HUD Web page on loan fraud. When the interest rate is later locked, a revised GFE must be provided showing the revised interest rate-dependent charges and terms. 76 FR 78981, Dec. 20, 2011, unless otherwise noted. result, it may not include the most recent changes applied to the CFR. However, if the lender denies the borrower's application for credit before the end of the three-business-day period, then the lender need not provide the booklet to the borrower. FAR). Upon completing the initial escrow account analysis, the servicer must prepare and deliver an initial escrow account statement to the borrower, as set forth in paragraph (g) of this section. Subject to the exceptions set forth in this paragraph, the lender shall provide a copy of the special information booklet to a person from whom the lender receives, or for whom the lender prepares, a written application for a federally related mortgage loan. 49 CFR 172.101 (1) The person making each referral has provided to each person whose business is referred a written disclosure, in the format of the Affiliated Business Arrangement Disclosure Statement set forth in appendix D of this part, of the nature of the relationship (explaining the ownership and financial interest) between the provider of settlement services (or business incident thereto) and the person making the referral and of an estimated charge or range of charges generally made by such provider (which describes the charge using the same terminology, as far as practical, as section L of the HUD1 settlement statement). here. The special information booklet may be reproduced in any form, provided that no change is made other than as provided under paragraph (d) of this section. Servicers may use accounting procedures that result in lower target balances. 2604, as amended by the Dodd-Frank Act, requires the Director of the Bureau to prepare, at least once every five years, a booklet to help consumers applying for federally related mortgage loans to understand the nature and costs of real estate settlement services. 12 U.S.C. (iv) A return on franchise relationship may be a payment to or from a franchisee but it does not include any payment which is not based on the franchise agreement, nor any payment which varies according to the number or amount of referrals by the franchisor or franchisee or which is based on a franchise agreement which has been adjusted on the basis of a previous number or amount of referrals by the franchiser or franchisees. [FR Doc. As used in this section: Associate is defined in section 3(8) of RESPA (12 U.S.C. A request to the Bureau for approval of any changes other than the permissible changes specified in paragraphs (d)(2) and (3) of this section shall be submitted in writing to the address indicated in the definition of Public Guidance Documents in 1024.2, stating the reasons why the applicant believes such changes, deletions, or additions are necessary. If a borrower uses a mortgage broker, the mortgage broker shall distribute the special information booklet and the lender need not do so. (1) Except as otherwise provided in paragraphs (a), (b), or (h) of this section, either the lender or the mortgage broker must provide a GFE not later than 3 business days after a mortgage broker receives either an application or information sufficient to complete an application. full text search results (f) Binding GFE. A separate drafting site After you finish this toolkit: You'll know the most important steps you need to take to . (i) Violations of section 5 of RESPA (12 U.S.C. The initial escrow account statement shall indicate the amount that the servicer selects as a cushion. When the borrower's and seller's copies of the HUD1 or HUD1A differ as permitted by the instructions in appendix A to this part, both copies shall be provided to the lender (if the lender is not the settlement agent). A borrower will be deemed to have received timely reimbursement if the loan originator delivers or places the payment in the mail within 30 calendar days after settlement. If a particular payee, such as a taxing body, receives more than one payment during the escrow account computation year, the statement shall indicate each payment and disbursement date. (b) Open-end lines of credit (home-equity plans) under Regulation Z. Payment due date means the date each month when the borrower's monthly payment to an escrow account is due to the servicer. 1024.14 Prohibition against kickbacks and unearned fees. Escrow account item or separate item means any separate expenditure category, such as taxes or insurance, for which funds are collected in the escrow account for disbursement. Except as provided in paragraphs (g) (1) (ii) and (iii) of this section, the creditor shall provide a copy of the special information booklet (required pursuant . Home Loan Tool Kit - Bankers Online Learn more about the eCFR, its status, and the editorial process. (2) A referral also occurs whenever a person paying for a settlement service or business incident thereto is required to use (see 1024.2, required use) a particular provider of a settlement service or business incident thereto. The lender is responsible for ascertaining whether the GFE has been provided. (2) No person making a referral has required (as defined in 1024.2, required use) any person to use any particular provider of settlement services or business incident thereto, except if such person is a lender, for requiring a buyer, borrower or seller to pay for the services of an attorney, credit reporting agency, or real estate appraiser chosen by the lender to represent the lender's interest in a real estate transaction, or except if such person is an attorney or law firm for arranging for issuance of a title insurance policy for a client, directly as agent or through a separate corporate title insurance agency that may be operated as an adjunct to the law practice of the attorney or law firm, as part of representation of that client in a real estate transaction. (2) The name, address, and other information regarding the lender and settlement agent may be printed in sections F and H, respectively. 2604). These can be useful However, the guide is a general purpose document and does not provide information to determine whether a HELOC is suitable for your particular needs. (10) As required by HUD/FHA in FHA-insured loans. (d) Permissible changes. the applicant believes such changes, deletions, or additions are necessary. [76 FR 78981, Dec. 20, 2011, as amended at 78 FR 10875, Feb. 14, 2013]. The revised GFE may increase charges for services listed on the GFE only to the extent that the changed circumstances affecting the loan actually resulted in higher charges. daily Federal Register on FederalRegister.gov will remain an unofficial For escrow accounts established after settlement (and which are not a condition of the loan), a servicer shall submit an initial escrow account statement to a borrower within 45 calendar days of the date of establishment of the escrow account. Appendix A to Part 1024 Instructions for Completing HUD-1 and HUD-1a Settlement Statements; Sample HUD-1 and HUD-1a Statements, Appendix B to Part 1024 Illustrations of Requirements of RESPA, Appendix C to Part 1024 Instructions for Completing Good Faith Estimate (GFE) Form, Appendix D to Part 1024 Affiliated Business Arrangement Disclosure Statement Format Notice, Appendix E to Part 1024 Arithmetic Steps, Appendix MS to Part 1024 Mortgage Servicing, Appendix MS-4 to Part 1024 Model Clauses for the Written Early Intervention Notice. For a flood insurance premium payable every 3 years, the servicer shall collect the payments reflecting 36 equal monthly amounts. Escrow account means any account that a servicer establishes or controls on behalf of a borrower to pay taxes, insurance premiums (including flood insurance), or other charges with respect to a federally related mortgage loan, including charges that the borrower and servicer have voluntarily agreed that the servicer should collect and pay.