Docu Prep Celebrates Christmas Party at Food Bank


Creating labels, packaging spaghetti and wearing hair nets were just a few of Docu Prep’s holiday party activities this year. In lieu of a fancy company Christmas Party, Docu Prep spent their holiday celebration at the Utah Food Bank.

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What’s the Latest? A Look Into News and Compliance.


HUD Eliminates FHA 1% Origination Fee Cap

January 5, 2010


In order to be consistent with recent changes to regulations under the Real Estate Settlement Procedures Act (RESPA), the U.S. Department of Housing and Urban Development (HUD) released a Mortgage Letter 2009-53, December 31, 2009. The Letter will remove the 1% origination fee cap on FHA-insured loans which are originated under FHA s standard mortgage insurance program.

With the new RESPA law, which went into effect January 1, 2010, lenders are now required to disclose a single, bundled origination fee on the Good Faith Estimate (GFE) and HUD-1 Settlement Statement. The law requires all origination administrative, processing, mortgage lender and broker’s compensation fees to be bundled into one, single origination charge. With the origination fee bundled as it is now required, the aggregate charge will often exceed the 1% origination fee cap. Because of this, HUD has removed the origination fee cap.

Although HUD is removing the origination fee cap, HUD still requires lenders to be "fair and reasonable" with FHA origination fees. Furthermore, HUD stated they intend to issue a percentage cap on the amount of fees that FHA lenders may charge their borrowers, which will potentially go into effect the first quarter of 2010.


HUD Delays Enforcement of New RESPA Rules.

November 18, 2009


FHA approved lenders and mortgages scurrying to comply with the RESPA rule, may have reason to relax. The U.S. Department of Housing and Urban Development (HUD) announced November 13, 2009 plans to lessen or restrain enforcement of new regulatory requirements under the new RESPA rules, which will go into effect January 1, 2010.

The Mortgage Review Board (MRB) will delay enforcement until May 1, 2010, but with stipulations. As long as the MRB has reason to believe that FHA approved mortgages have made a good faith effort to comply with the new requirements, the MRB will exercise restraint in taking enforcement actions. To determine whether lenders have made a good faith effort, the MRB will consider lenders' effort and commitment in technology, training and quality control regarding compliance to the new RESPA rules.

This announcement does not change the effective date of the new RESPA rules nor allow for any delayed implementation. Rather, HUD has acknowledged that integration of the new requirements may be a bit rocky at first. HUD has also asked other federal and relevant state enforcement agencies to exercise the same 120-day restraint in enforcement for non-FHA originations and other settlement providers that make good faith efforts to comply.

Docu Prep Prepares for Compliance to Final Risk-Based Pricing Rule

December 22, 2009


The Federal Reserve Board and the Federal Trade Commission announced the Final Rules, which coincides with the risk-based pricing rule passed six years ago. The Final Rules requires lenders to issue consumers a risk-based pricing notice when, based off the their credit report, the consumer receives less favorable loan terms compared to others. Those who receive this notice will be able to obtain a free credit report to check for accuracy.

Final Rules also allows lenders to provide their consumers with a free credit score and information about their score instead of providing a risk-based pricing notice. In preparation for the the new Final Rules, Docu Prep will be developing a risk-based pricing notice with alternative language for if the lender desires to provide a free credit report instead, as per the new Rule.


HUD Issues Updated Settlement Cost Booklet

December 16, 2009


The U.S. Department of Housing and Urban Development has released an updated Settlement Cost Booklet. January 1, 2010, lending institutions will be required to give borrowers the updated booklet within three days of application.

The booklet is 49 pages long and includes home purchasing advice, the Good Faith Estimate, the HUD-1 Settlement Statement, Glossary of Terms and other important information buyers may need.


Federal Deposit Insurance Corporation Adopts New Model Privacy Form

October 28, 2009


The Federal Reserve Board and the Federal Trade Commission announced October 28, 2009 the Final Rules, which coincides with the risk-based pricing rule passed six years ago. The Final Rules requires lenders to issue consumers a risk-based pricing notice when, based off the their credit report, the consumer receives less favorable loan terms compared to others. Those who receive this notice will be able to obtain a free credit report to check for accuracy.

Final Rules also allows lenders to provide their consumers with a free credit score and information about their score instead of providing a risk-based pricing notice. In preparation for the the new Final Rules, Docu Prep will be developing a risk-based pricing notice with alternative language for if the lender desires to provide a free credit report instead, as per the new Rule.

The Final Rules will not be effective until January 1, 2011. Docu Prep is intending to add the disclosure in mid 2010.

Did you know?


Docu Prep has expanded its private cloud architecture with a newly secured top-tier data center. The new Las Vegas data center will reduce power, increase overall efficiency, while providing customers with the highest levels of speed, accuracy and compliance.


MISMO January Trimester Workgroup


Docu Prep will be attending the MISMO Trimester Workgroup Meeting in Jacksonville, Florida, January 25th - 28th. MISMO is a subsidiary of Mortgage Bankers Association (MBA). Workshops will include credit reporting, mortgage insurance, eMortgage, and Information Security among several others offered.

mismo



Customer Service Tip


What do I need to know about GFE changes? Where can I go for answers?


With the new RESPA rules in full force, finding yourself in a frenzy may be the norm these days.

tip

To help relieve GFE stress, Docu Prep provides a link to HUD’s RESPA FAQ. The link is found under the compliance section of Docu Prep’s website. Visit www.docuprep.com/compliance to find the RESPA FAQ.

Looking Forward

January

1

HUD’s new RESPA laws go into effect. GFE, HUD-1, and  HUD-1 A change requirements are now implemented.

18

Martin Luther King Day
Docu Prep will be closed for MLK Day.

25

MISMO Conference (25-28)
Docu Prep will be attending the four day workgroup meeting in Jacksonville, Florida.

 

End of month

E3 integration complete.

February

 

First of month

Docu Prep’s Las Vegas data center up and running.

15

Presidents Day
Docu Prep will be closed in observation of the Federal Holiday

Docu Prep Armed and Ready for GFE Compliance

With Docu Prepʼs New Feature, Customers Have Reason to Relax


With HUD's new GFE requirements, lenders have been scrambling to update their systems in preparation for January 1, 2010. Now that the date has come and gone lenders and mortgage institutions are still configuring their systems, frequently referring to HUD's FAQ and implementing the new changes.

To prepare for these newly mandated requirements, Docu Prep created a simple feature which provides customers with an easy transition to comply with any GFE changes that are currently in place and that may be on the horizon.

Concerns over RESPA regulations have invariably been raised due to the major changes to the GFE. However, Docu Prepʼs application allows for a simple and easy integration of Good Faith changes and existing LOS systems.

"Our customers can continue to use their LOS systems without any technical upgrade," Docu Prepʼs Senior Architect, Josh Arceo commented. "Users will be able to use the old forms or new forms simultaneously."

Docu Prepʼs new feature allows users to easily disclose their fees and comply with GFEʼs regulatory requirements while maintaining a parallel structure to their current LOS systems. Adhering to compliance with these new regulations is a simple task for Docu Prepʼs customers, while minimal changes have been made to their current processes.

"Compliance with the new GFE/HUD requirements is greatly enhanced with the simple, client-driven approach," Ann Savage, General Counsel for Docu Prep stated. "Early testing and parallel systems helped our clients to understand the product and legal changes and how they worked in practice before the January 1st deadline."

Not only does Docu Prepʼs new application minimize changes to customersʼ current processes but it also enhances their understanding of the new requirements that are in place. "The new feature will provide a clearer understanding of how fees interact with the new GFE and HUD-1 Settlement Statement, and will ensure a more precise comparison of fees between initial disclosure and closing documents," Docu Prepʼs Senior Analyst, Britt Christiansen commented.

Docu Prep Celebrates Christmas Party at Food Bank


Creating labels, packaging spaghetti and wearing hair nets were just a few of Docu Prep’s holiday party activities this year. In lieu of a fancy company Christmas Party, Docu Prep spent their holiday celebration at the Utah Food Bank.

With unemployment, hunger and homelessness on the rise, donating the party fund seemed most appropriate this holiday season. A party fund donation wasn't the only contribution the non-profit organization received. Docu Prep employees spent several hours at the Utah Food Bank packaging spaghetti, which was shipped to different locations around the region.

Assembling boxes of noodles on what resembled a factory line for four hours would perhaps warrant some disgruntled employees. But Docu Prepʼs staff was anything but that. "It was a rewarding experience," Docu Prep employee, Kami Schmidt commented, "We were able to have fun and interact with each other, while serving our community."

Seventeen-year Docu Prep veteran, Vaughn Silcox enjoyed the opportunity to volunteer his time. "I think that it is important to serve as often as you can. Without the help of volunteers, the Food Bank would not be able to help as many people as they do," he stated.

Scott Buchanan, President of Docu Prep, was happy to redirect the companyʼs efforts and resources that are normally used for Christmas parties and gifts, to people struggling in the community. "While we feel fortunate about where we are in our business, we know that others have not been," Buchanan said, "It was a great day to help others and spend time together outside of the office in a great cause."

About Utah Food Bank
The Utah Food Bank has been in service since 1904, while their mission has remained the same --"Utah Food Bank Services meets the immediate, basic needs of people in our community who donʼt know where else to turn."

The non-profit organization has received numerous awards including the Jane Addams Award presented by the Utah Chapter of the National Association of Social Workers.

In 2008 alone, the Food Bank collected and distributed 19 million pounds of food, completed over 2,215 home repairs for low-income seniors, and met over 1.6 million emergency food requests. For more information on the Utah Food Bank visit www.utahfoodbank.org.