Using Revised Loan Estimates: New Intent to Proceed? New 7-day Waiting Period?
These are two basic issues that you may have seen some confusion over. Frustrating, I know. But here are the "basic" (i.e., reliable) answers.
So here's the scenario: We are processing a mortgage application, and a fee changes such that we need to issue a revised Loan Estimate. Here are two questions that come up, along with two answers:
#1: Need to have new Intent to Proceed?
No. You are only required to receive the consumer's intent to proceed once, not every time the Loan Estimate is revised.
The Rule (1026.19(e)(2)) just says that a lender cannot charge any fees (except for a credit report) before the consumer has indicated an intent to proceed. The Rule does NOT say that a new intent to proceed is required every time a revised Loan Estimate is issued. That wouldn't make any sense anyway - in many cases the lender would have already charged the consumer for fees by the time a revised Loan Estimate was issued.
#2: Need to wait 7 days before closing?
No. We must wait 7 days after providing the initial Loan Estimate to close the loan. That 7-day requirement does not apply to revised Loan Estimates.
Unfortunately, there has been some confusion around this issue for two reasons.
First, the CFPB made the mistake in a previous version of its Small Entity Guide. The CFPB admits that this was a "glitch" and the current version has been corrected. But if you printed out the Guide back in the Spring and are still using it, it's wrong!
Second, if your institution is relying on regular mail delivery of disclosures (as opposed to electronic or in-person delivery), then your institution is imposing upon itself a 7 day wait. Why? Because any revised Loan Estimate must be received at least 1 day before the Closing Disclosure. Of course, there is at least a 3-day wait on the Closing Disclosure. That's 4 days. If your institution mails the revised Loan Estimate, that adds an extra 3 days for mailing.
In other news:
It's not always so great to rent (all the better reason to be a homeowner!), as Massachusetts government realizes ... they're working on helping tenants avoid getting taken advantage of by publicizing what legal rights tenants have on Mass.gov.
According to The Economist, "Frequent flying leads to premature ageing. Plus, your spouse gets annoyed while you are away."
Whatever your thoughts are on Julian Assange, you've got to admit he's been amazingly productive while locked up in the embassy for the past year, controlling everything from a computer and phone: is always releasing our government's secret documents, wrote a book, founded a political party, testified to the United Nations, has entertained celebrities, and helped with the production of movies about him.
In this section of the newsletter we intend to share something we believe to be interesting, or important. Something unrelated to compliance. Often related to general management or business principles. But to veer a little off track for one week ... Do you skip breakfast? Maybe you're trying to lose weight, or just don't have much of an appetite. Well, don't - skipping breakfast is universally considered a pretty bad idea. Here are some quotes from Nancy Clark (a health expert from Massachusetts that has worked with the Red Sox, Celtics, and Olympic athletes) about breakfast:
"Of all the nutrition mistakes you might make, skipping breakfast is the biggest."
"If you skip breakfast, you're likely to concentrate less effectively in the late morning, work or study less efficiently, feel irritable and short tempered, or fall short of energy for your afternoon workout."
"Skipping breakfast to save calories is an unsuccessful approach to weight loss. ... If you are tempted to save calories by skimping on breakfast, remember that you don't gain weight by eating this meal. You do gain weight if you skip breakfast, get too hungry, and then overindulge at night. If you are going to skip any meal, skip dinner rather than breakfast."
So there you have it. SCA's first (and last, John?) health tip of the week.
"For changes to be of any true value, they've got to be lasting and consistent."
- Tony Robbins
**Terribly sorry to announce that our cartoonist Randy Glasbergen recently passed away at the age of 58. We'll continue purchasing cartoons from his business, which will be run by family members.There are those that believe the quality of your life can be measured by how many times a day you laugh. If that's true, Randy's passing will lower the quality of life for a lot of people.**
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**These are our opinions. We're not authorized, or willing, to express those of others.**