Based on the results of DocuTech’s yearly state-specific disclosure audit, the configurations for several documents will be changed as follows:
1. GA Foreclosure Disclosure (Cx1011). This document is provided pursuant to the provisions of Ga. Code Ann. §7-1-1014(3) and Ga. Comp. R. & Regs. r. 80-11-1-.01(8), which requires that it should be given in connection with a “mortgage loan.” A “mortgage loan” is defined as a loan secured by “residential real property” (see Supra §7-1-1000), the official definition of which explicitly excludes rental property and second homes from being considered “residential property” (see Ibid. ).
This being as it is, Cx1011 is not required to be given in connection with loans secured by rental property (aka investment property) or second homes. The configurations for Cx1011 will be changed accordingly, to prevent it from being disclosed in a non-applicable loan package.
2. GA Disclosure of Net Tangible Benefit (Cx4235). This document is provided pursuant to the provisions of Ga. Code Ann. §7-6A-4, which prohibits a creditor from “flipping” a home loan. “Flipping a home loan is the consummating of a high-cost home loan to a borrower that refinances an existing home loan that was consummated within the prior five years when the new loan does not provide reasonable, tangible net benefit to the borrower . . .” (Ibid.)
Currently, Cx4235 prints for all types of loans and not just for high-cost home loans. Since the anti-flipping provision only applies to such loans, Cx4235’s configuration will be changed accordingly.
3. FL Application Disclosure (Cx3421). This document is provided pursuant to the provisions of Fla. Stat. Ann. §494.0068(1), which requires a mortgage lender to provide this disclosure
“before accepting an application fee in whole or in part, a credit report fee, an appraisal fee, or a fee charged as reimbursement for third-part charges . . .”
Currently, Cx3421 will print regardless of whether a client is acting as a broker or a lender in a transaction. A “`mortgage lender’ means a person making a mortgage loan . . .” (Ibid. §494.001), which in common usage means that it is a person who extends (as opposed to arranges) a mortgage loan. This, coupled with the fact that Ibid. §494.0068(1) forms a part of Part III, Chapter 494 of Florida’s statutes (which is directed towards mortgage lenders, as opposed to Part II which is directed towards mortgage brokers), infers that only lenders are required to provide Cx3421. The configurations for this document will be changed accordingly.
This document will be available on June 1, 2012. If you have any questions or concerns about this change, please contact Client Support at 1.800.497.3584.
May 25, 2012