17 Del. Reg. Regs. 994 (April 1, 2014) repeals many of the sections found in Chapters 21 and 22 of Title 5 of Delaware’s regulations, and re-enacts them with substantive changes. Due to these, we will be making the following revisions to several of our Delaware documents:
Retirement: DE Mortgage Loan Broker Regulations (Cx3593) and DE Licensed Lenders Regulation (Cx3845)
These two documents were required under 5 Del. Admin. Code §§ 2103-1.0 & 2203-1.0, respectively. These two regulations have been substantively replaced and not re-enacted in any other part of the finalized regulations. As a result, there are no requirements in Delaware for brokers or lenders to provide copies of Delaware’s regulations to borrowers. We will, therefore, be retiring these two documents.
Revisions: DE Broker Agreement (Cx3583) and DE Mortgage Loan Commitment (Cx15752)
Due to the new regulations affecting Cx3583 (Ibid. §§ 2102-1.2.7, 2103-2.0 & 6.0, 2104, and 2203-6.0), we will be making the following changes to this document:
1. Updating the legal references;
2. Including default text in Section 3 which specifies how the broker will be compensated. Dynamic text will print based on whether the broker is being compensated by the borrower/seller or lender. We will also be including a field (40724) which will print additional text, if such text is entered by a client;
3. Section 4 will be revised so that the total (estimated) dollar amount of Broker compensation will print, rather than a range and a maximum. This section will also contain the regulatory prescribed text concerning the costs of services not exceeding the amount disclosed;
4. Section 5 will be revised to list all the fees which will be paid in connection with the loan. The Section will be subdivided into two parts. The first part will list the compensation being paid to the broker; the second part will list all the remaining fees. The fees will be disclosed in a table which will contain a description and the dollar amount of the fee, plus when the fee will become due and payable;
5. A new Section 6 will be added which states that, with the exception of appraisal and credit report fees, all other fees are non-refundable (subject to applicable law and other terms in the agreement). For the appraisal and credit report fees, hardcoded text will appear specifying under what conditions these fees are refundable; and
6. Other minor grammatical edits (e.g. changing the verb tenses in the list of services in Section 2).
Also due to the new regulations affecting commitment letters (see Ibid. §§ 2102-1.3.3, 2103-3.0 & 4.0, and 2203-2.0), we will be making the following edits to Cx15752:
1. Changing the title of the document so it refers to an agreement;
2. Updating and moving the legal citation from the beginning of the document to the third paragraph from the end; and
3. Including as the fourth paragraph from the end a fees table, similar to the one being included as Section 5 to the broker agreement.
New Document: DE Lock-in Agreement
Due to the fact that a lock-in fee may now only be collected pursuant to a written agreement (see Ibid. §§ 2103-3.1.3 & 2203-5.1), we will be providing a generic lock-in agreement for Delaware, which discloses some of the basic terms of the loan, the rate being locked in, the amount of the lock-in fee, and the length of time the agreement remains in effect.
This document will print in Initial Disclosure packages when “Lock-in Fee Charged on Loan” equals “Yes.”
Due to the very short time frame that Delaware has given between the publication of the final rules and their effective date, these changes will take effect on April 11, 2014. If you have any questions or concerns about these changes, please contact Client Support at 1.800.497.3584.
April 7, 2014
DR 151785