New requirements concerning higher-priced mortgage loans (HPMLs), defined and regulated by Federal Regulation Z, went into effect on June 1, 2013 (see article entitled “The June 2013 CFPB Regulations,” available at http://www.docutechcorp.com/the-june-2013-cfpb-regulations, for more details). Among these requirements is a stipulation that, for certain HPMLs secured by a first lien on a consumer’s principal dwelling, an escrow account be established for the payment of property taxes and (when applicable) insurance premiums and that such an account must be maintained on the property for at least five years (see 12 CFR § 1026.35[b]).
While Regulation Z does not require a disclosure in connection with this requirement, certain investors have required a type of certification from the borrower, in which the borrower is made aware of this requirement and acknowledges such. Some customers have also requested this type of certification, for their own purposes.
To accommodate these requests, we will now be providing Cx17599 on an “upon request” basis. The document provides the borrower with a simple overview of what a HPML is and informs them of the escrow requirement.
A new document print trigger field, entitled “Five Year Escrow Account Required for HPML,” has been created for making this document to print under the right conditions, once assigned to a customer.
The field will be globally mapped to “Yes” (and will cause Cx17599 to print) based on the conditions used in our ConformX HPML warning (see the aforementioned article for details about this warning). The field may also be imported and prompted for. The document will print in Closing packages.
The document is now available to those who request it.
June 28, 2013