11.14.18   •   Document Updates

Product Updates: New Support for Cooperatives in California, Connecticut, District of Columbia, Florida, Maryland, Virginia, and Washington

As a part of our efforts to expand the scope of our support for loans secured by a borrower’s ownership shares and lease in a cooperative unit (“cooperative loans”), we are pleased to announce that we will be rolling out support for these types of loans in California, Connecticut, the District of Columbia, Florida, Maryland, Virginia, and Washington.

Background

Docutech is in the process of improving support for the fifteen states which the Federal National Mortgage Association (“FNMA”) lists in their “Co-Op Share Loan Documentation Requirements” (available directly at: https://www.fanniemae.com/content/eligibility_information/coop-share-loan-documentation-requirements.pdf). Our support is limited to cooperative loans which FNMA will purchase, the features of which are that they are conventional, first lien loans secured by a lease in a cooperative unit which is the borrower’s primary or secondary residence (see https://www.fanniemae.com/content/guide/selling/b4/2.3/03.html). We will be providing several of the documents listed in FNMA’s requirements, as detailed below.

The nature of a cooperative loan will vary based on whether state law considers such loans to be secured by real or personal property. Basically, if state law considers the loan to be secured by real property, generally the lease can be secured by a mortgage or deed of trust, similar to the way real property is secured. If state law considers them to be secured by personal property, the shares and lease are basically secured by a “loan security agreement” and a UCC-1 is filed for record.

Based on consultations with outside counsel, it has been determined that cooperative loans are to be treated as being secured by real property in the states of California, Connecticut, Florida, Virginia, and Washington, as well as the District of Columbia. As a result, we will continue to provide FNMA’s uniform notes and security instruments for these jurisdictions, without any additional changes to the documents themselves (though the security instruments will be modified via a new “Cooperative Rider”, as detailed below).

Also based on feedback from outside counsel, it has been determined that cooperative loans are considered to be secured by personal property in Maryland.  We will be providing our generic “Loan Security Agreement” (Cx4987) for cooperative loan in this state, as detailed below.

New Documents

We will be creating the following new documents:

  • Cooperative Rider (Cx22760). This rider modifies FNMA’s uniform instruments by adding or modifying provisions to make the instruments compatible with the nature of cooperative forms of ownership, such as securing the proprietary lease and membership shares (rather than the unit itself). Of particular note is the fact that this rider assigns to the lender the proprietary lease, making a separate assignment of proprietary lease superfluous when the rider is used (though we will continue to have separate assignments available, as detailed further below). This rider will print only for states where a cooperative loan is considered to be secured by real property and it will print under the following circumstances:
    • Base Type = Conventional
    • Cooperative = Yes
    • Document Package Type = Closing
    • HELOC = No
    • Lien Position = FirstLien
    • Occupancy = PrimaryResidence
    • Occupancy = Second Home
    • State Code = California
    • State Code = Connecticut
    • State Code = District of Columbia
    • State Code = Florida
    • State Code = Virginia
    • State Code = Washington
  • Multistate Loan Recognition Agreement (Cx22776). This document is an agreement between the lender and the cooperative association about certain aspects of the lender’s secured interest in the shares and lease of the cooperative unit (e.g., the cooperative association agreeing to inform the lender if the borrower is in default under the terms of the proprietary lease). Different cooperative associations may require their own recognition agreements, but we will provide this new form on a generic basis for clients who wish to use it (except in New York, where our current, generic “NY Aztech Recognition Agreement – COOP,” Cx8091, will continue to be used). This new document will print under the following conditions:
    • Base Type = Conventional
    • Cooperative = Yes
    • Document Package Type = Closing
    • HELOC = No
    • Lien Position = FirstLien
    • Occupancy = PrimaryResidence
    • Occupancy = SecondHome
    • State Code = California
    • State Code = Connecticut
    • State Code = District of Columbia
    • State Code = Florida
    • State Code = Maryland
    • State Code = Virginia
    • State Code = Washington
  • Multistate Stock Pledge Agreement (Cx22775). Common in Connecticut, a stock pledge agreement assigns from the borrower to the lender the borrower’s “right, title, and interest” in the membership shares of the cooperative association. Due to the value this stock pledge agreement gives lenders, we will be printing it on a generic basis in several (but not all) of the states where a cooperative loan is considered to be secured by real property. This document will be configured to print under the following conditions:
    • Base Type = Conventional
    • Cooperative = Yes
    • Document Package Type = Closing
    • HELOC = No
    • Lien Position = FirstLien
    • Occupancy = PrimaryResidence
    • Occupancy = SecondHome
    • State Code = Connecticut
    • State Code = District of Columbia
    • State Code = Florida
    • State Code = Virginia
    • State Code = Washington
  • Multistate Assignment of Proprietary Lease (Cx22777). While our new “Cooperative Rider” does assign to the lender the proprietary lease and permits the lender to assign such lease to whichever party the lender chooses, we will be providing as an “upon request” document a new “Multistate Assignment of Proprietary Lease” in which a lender assigns the lease to an investor (for lenders and/or investors who wish to have an assignment apart from the cooperative rider). We will only be providing this document on a generic basis in the states which consider cooperative loans to be secured by real property. Once assigned, this document will print under the following conditions:
    • Base Type = Conventional
    • Cooperative = Yes
    • Document Package Type = Closing
    • HELOC = No
    • Lien Position = FirstLien
    • Occupancy = PrimaryResidence
    • Occupancy = SecondHome
    • State Code = California
    • State Code = Connecticut
    • State Code = District of Columbia
    • State Code = Florida
    • State Code = Virginia
    • State Code = Washington

UCC-1

FNMA’s “Requirements” stipulate that a UCC-1 (used to record the lender’s security interest under a states’ Uniform Commercial Code statutes) and UCC-3 (which is used to assign the security interest from the lender to another entity) must be provided in certain states, including ones which are considered to be secured by real property.

Therefore, we will be modifying our “UCC-1 Financing Statement” (Cx7700) in the following ways:

  • Currently, Cx7700 is configured to be “assigned upon request” (e. it will not print unless a client has specifically asked for it to be configured for them). We will be changing this by causing Cx7700 to always print under the following conditions:
    • Cooperative = Yes
    • Document Package Type = Closing
    • Lien Position = FirstLien
    • Occupancy = PrimaryResidence
    • Occupancy = SecondHome
    • State Code = District of Columbia
    • State Code = Maryland
    • State Code = Virginia
    • State Code = Washington

We have retained the original configurations for Cx7700 (and any custom configurations) for clients who currently have this document assigned to them.

  • We are incorporating into the Cx7700 the “UCC-1 Addendum” and “UCC-1 Additional Parties” documents available from the International Association of Commercial Administrators’ website (https://www.iaca.org/secured-transactions/forms/). These forms will only print in the document under applicable conditions (g. the “UCC-1 Additional Parties” will only print if there are four or more borrowers).

We will also be modifying our “FL UCC-1 Financing Statement” (Cx16930) in similar manner to Cx7700 by incorporating the FL UCC-1 Addendum, FL UCC-1 Additional Party, and FL UCC-1 Additional Information forms (available at: https://www.floridaucc.com/uccweb/forms.aspx) into Cx16930.

We are also modifying these documents so that they name MERS as the secured party for MOM loans (per the “MERS® System Procedures Manual”). When “MERS = Yes”, MERS will be listed in Section 3 of the UCC-1 (along with MERS’ post office box address in Michigan), with the MIN and MERS’ phone number (888-679-6377) appearing in Section 8.

UCC-3 and MERS

To meet FNMA’s “Requirements”, we will be providing the following new generic versions of the UCC-3:

  • UCC-3 Financing Statement (Cx22755). This document will be configured to print when:
    • Cooperative = Yes
    • Document Package Type = Closing
    • Lien Position = FirstLien
    • Occupancy = PrimaryResidence
    • Occupancy = SecondHome
    • State Code = District of Columbia
    • State Code = Maryland
    • State Code = Virginia
    • State Code = Washington
  • Florida UCC-3 Financing Statement (Cx22756)
    • Cooperative = Yes
    • State Code = Florida

Similar to the UCC-1 Form, we have incorporated the IACA- and Florida-versions of the addenda/additional information forms for the UCC-3 within Cx22755 and Cx22756. Since the UCC-3 will only be used in our system for the purposes of assigning the security interest, Section 3 will always be checked.

For Non-MOM loans which are to be assigned to MERS, when Field “MERS = Yes”, the relevant information about MERS (i.e. the same information about MERS which can appear on the UCC-1) will populate in Sections 7 and 10 of the UCC-3.

Similar to our regular assignments, we are creating separate copies of the UCC-3 which can be used as an assignment from MERS to a lender. These documents are the UCC-3 Financing Statement from MERS (Cx22778) and the Florida UCC-3 Financing Statement from MERS (Cx22779), which will have the same print configurations as Cx22755 and Cx22756, respectively, with the additional triggers of “MERS Assignment Type = From”, and “Print From MERS Assignments = Yes”. The relevant information about MERS will populate in Sections 9 and 10 of the UCC-3.

Riders

Because we will continue to use FNMA’s uniform security instruments in California, Connecticut, the District of Columbia, Florida, Virginia, and Washington, we will also continue to print some of FNMA’s uniform riders – where applicable – in these states for cooperative loans. However, these riders have been modified in certain aspects to make them compatible not only with the nature of a cooperative loan, but to ensure there are no conflicting provisions with the new “Cooperative Rider”.

These riders will also be used in Maryland and New York in connection with our generic “Loan Security Agreement” (Cx4987), which the riders will amend. Again, the text of these riders will be modified to make them compatible with the provisions of Cx4987, as well as with the nature of a cooperative loan.

Most of the general changes we will be making to the content of the riders are as follows:

  • Changing the definition of “Security Instrument” from “Mortgage, Deed of Trust, or Security Deed” to “Mortgage, Deed of Trust, Security Deed, or Loan Security Agreement” when “Cooperative = Yes”.
  • Changing references to “Property” to either “Security” or “Apartment” for New York cooperatives, as context demands, since the New York-version of Cx4987 defines the property secured by the agreement as “Security” and the cooperative unit itself as “Apartment”.
  • Modifying the clause in the first paragraph which introduces the property address (“which is located at:”), due to the fact that, while “Property” refers to property secured by the security instrument, the property secured by a cooperative loan is the shares and proprietary lease in the cooperative unit, rather than the cooperative unit itself. Using the current clause would indicate that the shares and lease have the same address as the cooperative unit, which may not be correct. Thus, we are generally changing this clause to reflect the following (minor variations will appear in each rider):
    • When the cooperative unit is not located in New York, “which includes a cooperative unit, which unit is located at:”
    • When the cooperative unit is located in New York, “which includes an Apartment (as described in the Security Instrument) which is located at:”
  • Modifying the title of the riders to include the prefix “Cooperative Unit” above the current title when “Cooperative = Yes”.
  • Modifying the footer of the riders to include the suffix “- Modified for Cooperative Loans” when “Cooperative = Yes”.
  • If the rider prints in New York for a cooperative, changing instances of “Property” to either “Security” or “Apartment”, depending on whether the rider is referring to the secured property or to the actual residential unit.

In addition to these changes, we will be making the following changes to the following riders:

  • Prepayment Rider (Cx30). No additional changes.
  • 3170 Rider 1-4 Family (Cx32).
    • Causing Section D (“‘Borrower’s Right to Reinstate’ Deleted”) to “not print” for cooperatives in Maryland and New York, since the cross-referenced section in Section D (Section 19) does not exist in our generic “Loan Security Agreement” (Cx4987) which prints for cooperatives in these states.
    • Removing the reference to “Section 9” within Section F for Maryland and New York and replacing it with this clause:

“These amounts shall bear interest at the Note rate from the date of disbursement and shall be payable, with such interest, upon notice from Lender to Borrower requesting payment.”

    • Adding a new section at the end of the document which deletes sections of either Cx4987 (for Maryland and New York) or of the new “Cooperative Rider” which governing rents (since these sections are substantively replaced by the provisions within the 1-4 Family Rider).
  • 3890 Rider Second Home (Cx35).
    • Because our generic “Loan Security Agreement” (Cx4987) does not contain the same provisions as those in Uniform Covenants 6 and 8 of FNMA’s uniform security instruments, we will be removing the clause “that Sections 6 and 8 of the Security Instrument are deleted and are replaced by the following:” when:
      • Property State = Maryland or New York
      • Cooperative = Yes
    • Since the provisions in this rider are being added into the security instrument, we are changing third-person pronouns (g. “Borrower”) to first- and second-person pronouns (e.g. “I” and “you”) for New York, to be consistent with the narratives in Cx4987 (which is done due to New York’s “plain language” requirements under N.Y. Gen. Oblig. § 5-702[a]).
    • Adding a second print condition to Cx35, so that it will print under the following conditions:
      • Base Type = Conventional
      • Cooperative = Yes
      • Document Package Type = Closing
      • HELOC = No
      • Lien Position = FirstLien
      • Occupancy = Second Home
      • State Code = California
      • State Code = Connecticut
      • State Code = District of Columbia
      • State Code = Florida
      • State Code = Maryland
      • State Code = New York
      • State Code = Virginia
      • State Code = Washington
  • Timely Payment Rewards Rider (Cx1479). No additional changes.
  • Enhanced Prepayment Penalty Rider (Cx12388). No additional changes.
  • MERS Rider (Cx18587). No additional changes.
  • 3198 Biweekly Rider (Cx19236).
    • Causing Section B to “not print” for cooperatives in Maryland (like we are currently doing in New York). Section B amends certain references in FNMA’s uniform security instruments, which references do not appear in our generic “Loan Security Agreement” (Cx4987). Therefore, Section B is not necessary.
  • 3199 Biweekly Rider Without Conversion (Cx19238).
    • Causing Section B to “not print” for cooperatives in Maryland (like we are currently doing in New York). Section B amends certain references in FNMA’s uniform security instruments, which references do not appear in our generic “Loan Security Agreement” (Cx4987). Therefore, Section B is not necessary.
  • Inter Vivos Revocable Trust Acknowledgment (Cx21130).
    • We will be modifying the reference to “Security Instrument” to “Security Agreement” when:
      • Property State = Maryland or New York
      • Cooperative = Yes
  • Inter Vivos Revocable Trust Rider (Cx21131).
    • Removing Clause (iii) from Subsection A(1) when “Cooperative = Yes”, since this clause is not necessary (subsequent clauses will be renumbered).
    • Reformatting Section C for cooperatives in New York, in order for the narrative and cross-references to match those of our generic “Loan Security Agreement” (Cx4987), which is used in New York.
  • HomeStyle Renovation Loan Investor Rider (Cx22292).
    • Similar to the 1-4 Family Rider, we are adding a new section to the end of the document which repeals provisions governing rents in either our generic “Loan Security Agreement” (Cx4987) or our new “Cooperative Rider”, because the provisions in Cx22292 substantively replaces these.
  • HomeStyle Renovation Loan Rider (Cx22294).
    • Revising certain clauses in Section 4 regarding the definitions of “Real Property” and “Personal Property” to make it more compatible with the nature of cooperative property (g. removing references to “Real Property” for cooperative loans in Maryland and New York, because these are treated as personal property).
    • Revising Section 8 for cooperative loans in Maryland and New York, to make it more compatible with our generic “Loan Security Agreement” (Cx4987).

We will also be adding to the print configurations for the following riders the condition “Cooperative = No”, since these riders are not necessary for cooperative loans:

  • Manufactured Home Affixation Affidavit (Cx43) and Manufactured Home Rider (Cx6806) – These riders are used when a manufactured home is affixed to real property. Even though there are cooperative projects comprised of mobile and manufactured homes (particularly in Florida), these homes are either already affixed to the cooperative project or the “cooperative unit” is a vacant plot whereon the borrower can set a mobile or manufactured home, but not permanently. In either case, this rider is not needed.
  • IL Land Trust Rider to the Mortgage/Deed of Trust (Cx4938) and IL Land Trust Beneficiary Agreement (Cx14156) – An Illinois land trust is only established in connection with real property. In Illinois, a lease in a cooperative unit is considered personal property, thus these riders are not needed.
  • The following CEMA GAP riders, because New York’s CEMA rules apply to real property and leases in cooperative units within New York are treated as personal property:
    • NY CEMA GAP – 3170 Rider 1-4 Family (Cx16199)
    • NY CEMA GAP – 3140 Rider Condo (Cx16200)
    • NY CEMA GAP – 3150 Rider PUD (Cx16201)
    • NY CEMA GAP – 3890 Rider Second Home (Cx16202)
    • NY CEMA GAP – FHA Rider Condo (Cx16246)
    • NY CEMA GAP – FHA Rider PUD (Cx16247)
    • NY CEMA GAP – FHA NonOwner Occupancy Rider (Cx16248)
    • NY CEMA GAP – FHA 1-4 Family Rider (Cx16249)
    • NY CEMA GAP – VA Rider Assumption Policy (Cx16250)
    • NY CEMA GAP – Affixation Affidavit (Cx16251)
    • NY CEMA GAP – Manufactured Home Rider (Cx16252)
    • NY CEMA GAP – Inter Vivos Revocable Trust Rider (Cx16253)
  • Leasehold Rider – Cross Default Provision (Cx18488) – The provisions in this rider are substantively included in the new “Cooperative Rider”, thus this rider is not needed.
  • FNMA Construction Loan Rider Amending Note (Cx22652), FNMA Construction Loan Rider to Security Instrument (Cx22653), and FNMA Construction Loan Investor Rider to Security Instrument (Cx22654) – FNMA does not accept construction cooperative loans (see FNMA 2018 Selling Guide B5-3.11-01).

Edits to Additional Documents

Other documents which will be edited include the following:

  • 3200 Note Fixed (Cx5). As previously announced, we had configured Cx5 (FNMA Form 3200) to print in New York for cooperative loans. We will be modifying this configuration so that Cx5 will print for cooperative loans in California, Connecticut, the District of Columbia, Florida, Maryland, Virginia, and Washington.
  • Conventional, First Lien Security Instruments. Because we will be using FNMA’s uniform instruments for states which consider cooperative loans to be secured by real property, will be adding the following as a second print condition to “CA Deed of Trust” (Cx312), “CT Mortgage” (Cx314), “DC Deed of Trust” (Cx315), “FL Mortgage” (Cx317), “VA Deed of Trust” (Cx354), “WA Deed of Trust” (Cx357):
    • Base Type = Conventional
    • Cooperative = Yes
    • Document Package Type = Closing
    • HELOC = No
    • Lien Position = FirstLien
    • Occupancy = PrimaryResidence
    • Occupancy = SecondHome
    • State Code = [Applicable state]
  • Assignment of Lease – COOP (Cx4982). Outside counsel has advised that this document is not necessary in Maryland and in states which treat cooperative loans as being secured by real property – in the latter case, because our new “Cooperative Rider” assigns the lease from the borrower to the lender. As a result, we will configure this document not to print in California, Connecticut, the District of Columbia, Florida, Maryland, Virginia, and Washington. It will, however, remain available to clients who may wish to have this document assigned to them for such states.
  • Consent to Assignment of Proprietary – COOP (Cx4983). Our new “Recognition Agreement” contains provisions wherein the cooperative association is notified of the assignment of the proprietary lease from the borrower to the lender. Thus, Cx4983 is no longer necessary and it will be configured to “not print” in California, Connecticut, the District of Columbia, Florida, Maryland, Virginia, and Washington. It will still be available, however, for clients who wish to utilize it.
  • Acceptance of Assignment and Assumption of Lease – COOP (Cx4984). Similar to Cx4983, the cooperative association is apprised of the assignment in our new “Recognition Agreement”, therefore we will be configuring Cx4984 to “not print” in California, Connecticut, the District of Columbia, Florida, Maryland, Virginia, and Washington. It will still be available, however, for clients who wish to utilize it.
  • Irrevocable Stock Power – COOP (Cx4986). We will be making a few minor, technical edits to this document, including replacing the word “Attorney” with the phrase “as my/our transfer agent and attorney-in-fact.”
  • Loan Security Agreement – COOP (Cx4987). All of the following modifications are for Maryland only.
    • We will be configuring this document to print for cooperative loans in Maryland, since such loans are considered to be secured by personal property.
    • The narrative of this form will be changed from a first- and second-person narrative (g. “I” and “you”) to a third-person narrative (e.g. “Borrower”) to make it consistent with other legal closing documents (such as the promissory notes and riders).
    • A new “Applicable Law” section has been added to define what “Applicable Law” is. It is added as Section 5.
    • Section 11 (“Transfer of the Property or Beneficial Interest in Borrower”) has been transferred to Section 18 and has been reformatted to match similar language found on the FNMA promissory notes and ARM Riders.
    • Section 22 (“Notices”) has been transferred to Section 15.
    • Section 12 (“Changes in the Law”) has been transferred to Section 28.
    • Certain provisions of the section entitled “Your Right on Default” have been modified to be more compatible with the default provisions of Maryland’s version of the Uniform Commercial Code (Md. Code Ann, Com. Law §§ 9-601 through 9-628).
    • Other textual changes to enhance the text of the document.
  • Assignment of Security Agreement – COOP (Cx4988). For states where a cooperative loan will be considered secured by real property, we will be providing our generic assignments of mortgage/deed of trust for cooperate loans rather than Cx4988. We will, therefore, be configuring Cx4988 to “not print” in California, Connecticut, the District of Columbia, Florida, Virginia, and Washington.
  • Affidavit of No Further Encumbrance – COOP (Cx4989). Similar to Cx4986, we will be making a few minor, technical edits to Cx4989, including changing the reference to the “cooperative apartment” to the more generic “cooperative unit”, since it is possible for cooperative property to not be an apartment.
  • Notice of Assignment of Security Agreement – Managing Agent – COOP (Cx4991). Similar to Cx4986 and Cx4989, we will be making a few minor, technical changes to Cx4991, including changing the references of “Security Agreement” to “Security Instrument” and “Cooperative Corporation” to “Cooperative Association”, for consistency between our cooperative documents.
  • Cooperative Apartment Fixed Rate Note (Cx4992). Because we will be using FNMA’s standard uniform notes for cooperative loans, we will be “retiring” this document from printing for cooperative loans in California, Connecticut, District of Columbia, Florida, Maryland, Virginia, and Washington.

Recording Format

We have formatted the following documents so that they can be recorded in the states that they print in (except for Cx4982, which will only be formatted for recording in California, Connecticut, the District of Columbia, Florida, Maryland, Virginia, and Washington):

  • Assignment of Lease – COOP (Cx4982)
  • Multistate Cooperative Loan Recognition Agreement (Cx22776)
  • Multistate Assignment of Proprietary Lease (Cx22777)
  • Multistate Stock Pledge Agreement (Cx22775)

These changes and new documents will be in effect on November 20, 2018. If you have any questions or concerns about these changes, please contact Client Support at 1.800.497.3584.

TW 240777 & Related DRs

 

Update: NY UCC Financing Statement (Cx19882) and New NY UCC-3 Forms

Similar to the changes we are making to our multistate and Florida copies of the UCC-1 and UCC-3 for cooperative loans, we will be enhancing our New York version of the UCC-1 (Cx19882) and create new versions of the UCC-3 for New York. Our edits are based on the New York Division of Corporations, State Records & UCC forms (available at: https://www.dos.ny.gov/corps/uccforms.html).

UCC-1

Cx19882 is a copy of the New York-version of the UCC-1, which is assigned “upon request.” We will be incorporating into this form the following forms:

  • UCC Financing Statement Addendum (Form UCC-1Ad)
  • UCC Financing Statement Additional Party (Form UCC-1AP)
  • UCC Financing Statement Cooperative Addendum (Form UCC-1Cad)

These additional forms will only print within Cx19882 as necessary (e.g. Form UCC-1AP will only appear if there is more than three borrowers).

We are also assigning the current configuration to Cx19882 to each client who has had this form assigned to their institution (unless they have their own custom print configuration). We will be configuring Cx19882 to print under the following conditions:

  • Base Type = Conventional
  • Cooperative = Yes
  • Document Package Type = Closing
  • HELOC = No
  • Lien Position = FirstLien
  • Occupancy = PrimaryResidence
  • Occupancy = Second Home
  • State Code = New York

UCC-3

We will be creating a new document (Cx22780) which incorporates the following forms into it:

  • UCC Financing Statement Amendment (Form UCC-3)
  • National UCC Financing Statement Amendment Addendum (Form UCC-3Ad)
  • UCC Financing Statement Amendment Additional Party (Form UCC-3AP)

Similar to Cx19882, Forms UCC-3Ad and Form UCC-3AP will only appear within this new document as necessary. We will be configuring this new form to print under the following conditions:

  • Base Type = Conventional
  • Cooperative = Yes
  • Document Package Type = Closing
  • HELOC = No
  • Lien Position = FirstLien
  • Occupancy = PrimaryResidence
  • Occupancy = Second Home
  • State Code = New York

MERS

We are modifying Cx19882 so that it names MERS as the secured party for MOM loans (per the “MERS® System Procedures Manual”). When “MERS = Yes”, MERS will be listed in Section 3 (along with MERS’ post office box address in Michigan), with the MIN and MERS’ phone number (888-679-6377) appearing in Section 8.

For Non-MOM loans which are to be assigned to MERS, when Field “MERS = Yes” the relevant information about MERS (i.e. the same information about MERS which can appear on the UCC-1) will populate in Sections 7 and 10 of the UCC-3.

Similar to our regular assignments, we are creating a separate copy of the UCC-3 which can be used as an assignment from MERS to a lender (Cx22781). It will have the same configuration as listed above, with the additional triggers of “MERS Assignment Type = From” and “Print From MERS Assignments = Yes”. Once again, when “MERS = Yes”, the relevant information about MERS will populate in Sections 9 and 10 of the UCC-3 Assignment from MERS.

These changes will also take effect on November 20, 2018. If you have any questions or concerns about these changes, please contact Client Support at 1.800.497.3584.

DR 276865

 

Update: Removal of Hard Stop Error for Florida

In concert with the introduction of support for cooperative loans in Florida, we are removing a hard stop Error from ConformX. This Error said, “Cooperative loans in Florida are not currently supported in ConformX. Please contact Support at {0} for assistance.” This Error fired for Cooperative loans in Florida, but will be removed immediately.

TW 244389

 

Update: Addition of Global Optional Prompt for Collateral Description

Since cooperative loans are considered to be secured by personal property in Maryland, the legal description of the property is not accurately described by our standard property description field, Field 1709 “Legal Description – Long Version”. Consequently, for cooperatives in Maryland, we are utilizing Field 49556 “Collateral Description” instead. Additionally, this field is used on the UCC-1 Financing Statement for DC, FL, VA, and WA to populate a section entitled “COLLATERAL: This financing statement covers the following collateral:” A new global optional field prompt, with applicable triggering logic, has been created to assist in filling out the Collateral Description when needed.

TW 242354

 

Update: Configuration Changes to Illinois Land Trust Documents

Upon further review, it has been determined that secured interests in a cooperative unit in Illinois are considered to be interests in real property, rather than personal property (see In re McNair, 90 B.R. 912, 915 [Bankr. N.D. Ill. 1988]). As such, it is possible for a cooperative loan to be extended to a land trust, with the ownership shares and occupancy agreement forming a part of the land trust property.

We will, therefore, be making the following changes to the following Illinois land trust documents:

  • IL Land Trust Addendum to the Mortgage Note (Cx4937). We will be enhancing the description of the subject property within the first paragraph, by changing the phrase “and located at:” to “which includes a co-operative unit located at:” when “Cooperative” (FI 22537) equals “Yes”.
  • IL Land Trust Rider to the Mortgage/Deed of Trust (Cx4938). We will be making the same textual change within Cx4938 as we are doing in Cx4937 (as described above). We will also be changing the document’s print configuration, so that it will print under the following conditions:
    • Cooperative = Allow Any
    • Document Package Type = Closing
    • Is Land Trust = Yes
    • State Code = Illinois
  • IL Land Trust Beneficiary Agreement (Cx14156). We will be changing the print configurations of this document to the following:
    • Cooperative = Allow Any
    • Document Package Type = Closing
    • Is Land Trust = Yes
    • State Code = Illinois

These changes will be in effect immediately. If you have any questions or concerns about these changes, please contact Client Support at 1.800.497.3584.

DR 280763