Document Updates: Enhanced Prepayment Fee Addendum (Cx12387) & Enhanced Prepayment Fee Rider (Cx12388)

After review, Docutech has updated Cx12387 “Enhanced Prepayment Fee Addendum” and Cx12388 “Enhanced Prepayment Fee Rider” to better match the “Borrower’s Right to Prepay” section of the Notes for adjustable rate and interest only loans.

The changes to the “Borrower’s Right to Prepay” sections of Cx12387 and Cx12388 affect the last sentence of the second paragraph, and may or may not include additional text dependent on the type of loan.

For fixed rate, non-interest only loans, the sentence at the end of the second paragraph will continue to print as shown below without any additional text following it:

“If I make a partial Prepayment, there will be no changes in the due date or in the amount of my Monthly Payment unless the Note Holder agrees in writing to those changes.”

For fixed rate, interest only loans; adjustable rate, non-interest only loans; and adjustable rate, interest only loans, the sentence at the end of the second paragraph has been modified to read:

“If I make a partial Prepayment, there will be no changes in the due date of my Monthly Payment unless the Note Holder agrees in writing to those changes.”

For fixed rate, interest only loans, the following additional text has been included directly after the existing sentence at the end of the second paragraph:

“However, if the partial Prepayment is made during the period when my Monthly Payments consist only of interest, the amount of the Monthly Payment will decrease for the remainder of the term when my payments consist only of interest as well as during the time that my payments consist of principal and interest. If the partial Prepayment is made during the period when my payments consist of principal and interest, the amount of my monthly payment will not decrease; however, the Principal and the interest required under this Note will be paid prior to the Maturity Date.”

For adjustable rate, non-interest only loans, the following additional text has been included directly after the existing sentence at the end of the second paragraph:

“My partial Prepayment may reduce the amount of my Monthly Payments after the first Change Date following my partial Prepayment. However, any reduction due to my partial Prepayment may be offset by an interest rate increase.”

For adjustable rate, interest only loans, the following additional text has been included directly after the existing sentence at the end of the second paragraph:

“If the partial Prepayment is made during the period when my Monthly Payments consist only of interest, the amount of the Monthly Payment will decrease for the remainder of the term when my payments consist only of interest. If the partial Prepayment is made during the period when my payments consist of principal and interest, my partial Prepayment may reduce the amount of my Monthly Payments after the first Change Date following my partial Prepayment. However, any reduction due to my partial Prepayment may be offset by an interest rate increase.”

Additionally, the document descriptions have been updated in Docutech’s document library for the following documents:

• • Cx12387 from “Enhanced Prepayment Penalty Addendum” to “Enhanced Prepayment Fee Addendum”
  • Cx12388 from “Enhanced Prepayment Penalty Rider” to “Enhanced Prepayment Fee Rider”
  • Cx12389 from “Enhanced Prepayment Penalty Disclosure” to “Enhanced Prepayment Fee Disclosure”

Consequently, the text that appears under the “Other Rider” section for Security Instruments will print “Prepayment Fee Rider” instead of “Prepayment Penalty Rider.”

These changes are available for testing on Stage & Stage 2 servers and will take effect on July 17, 2025. If you have any questions or concerns, please contact Client Support at 1.800.497.3584.

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DR-189689

The preceding is for informational purposes only and is not and may not be construed as legal advice. No third-party entity may rely upon anything contained herein when making legal and/or other determinations regarding its practices, and such third-party should consult with an attorney prior to embarking upon any specific course of action.