December Compliance Recap

As 2020 came to an end, states and lenders were adjusting many loan documents to reflect end of year changes in the industry. These changes are incorporated into ConformX, to ensure that your documents are in compliance with state, federal and investor requirements.

Follow our compliance blog to stay up-to-date on regulatory changes within the industry.

Revised Form HUD-92900-A, HUD Addendum to URLA: On December 22, 2020, HUD revealed a revised version of Form HUD-92900-A. The letter they put out also shared revisions to a variety of additional FHA forms, with new application dates.

FHLMC Permanently Adopts Some POA Requirements: Early in 2020, Freddie Mac and Fannie Mae promulgated temporary requirements due to COVID, in which the terms of a transaction involving a POA must be explained directly to the borrower before closing and such “meeting” must be “memorialized”. Originally, this requirement applied primarily to purchase transactions. Freddie Mac has made these requirements permanent and applicable to all transactions.

Document Updates:

New FHA Airport Runway Clear Zone Notice Document Added: In accordance with the recent updates to FHA Single Family Handbook 4000.1, an existing requirement was modified to specify that the mortgagee obtain the borrower’s acknowledgement of the hazards associated with the subject property being located in certain airport zones. Prior to this, HUD’s administrative law and handbooks did not reference the mortgagee in relation to this requirement. This went into effect on December 8, 2020. Learn more here.

New York Assignment Adjustments: According to FNMA’s latest authorized adjustment, any prior assignments or consolidation of mortgages must be listed in the first paragraph of their model New York Assignment to include the recording information, dates, and parties of such prior assignments or consolidation. These additions were made to the New York Assignment of Mortgage, New York Assignment from MERS and New York Assignment – INV BLANK. This went into effect on December 10, 2020. Learn more here.

2020 Graph Updates for Credit Score Disclosure: Cx15312, which is a duplicate of the Model B-3/H-3 Form promulgated under Federal Regulation V, has been updated to reflect the most recent 2020 graphs. This form is specifically for situations where credit will be secured by residential real property. This went into effect on December 10, 2020. Learn more here.

4506-C Income Verification Express Service Request for Transcript of Tax Return: Effective March 1, 2021 only the new IRS Form 4506-C will be accepted by the IRS through IVES. In accordance with that, Form 4506-T will be phased out and replaced by the 4506-C, which is currently available on Production. Learn more here and here.

Retiring of Cx4992 for Cooperative Apartment Fixed Rate Notes: Over the past few years, we have expanded our support for loans secured by shares and a lease in a cooperative association. Due to DI errors implemented during the expansion, plus the passage of time, it was determined that our old promissory note for these types of loans is no longer needed and has been retired as a standard document (it is still available as a custom document). This went into effect on December 17. 2020. Learn more here. 

Statement of Credit Denial, Termination or Change: The Statement of Credit Denial, Termination or Change incorporates duplicates of Model Forms C-1, C-4, and C-6. To improve the logic behind checking between the two subparts of C-1, such logic will be adjusted by adding an additional layer of fields. This went into effect on December 19, 2020. Learn more here.

Updates to Language for Consent Removing Internet Explorer as a Supported Browser: A recent release of Solex updated it past the capabilities of Internet Explorer. As a result, IE is no longer a supported browser. The default consent language is being updated to remove “Internet Explorer 9 or later” as a supported web browser. This went into effect on December 16, 2020. Learn more here.

VA Deed of Trust Second and NE Deed of Trust Second: After a standard review, some of the language that prints on two second lien DOT Security Instruments for Virginia and Nebraska has been modified to match the language of the first lien Security Instruments published by FNMA for these States. This went into effect on December 29, 2020. Learn more here.

Redesigned Uniform Residential Loan Application: After testing during the FNMA/FHLMC Limited Production Period, Section 9 and the Lender Loan Information section have been adjusted to fit the redesigned FNMA Form 1003/FHLMC Form 65. A new field in Section 9 has been added to allow for suppression of the Loan Originator eSignature section. A new option to suppress the Lender Loan Information has also been added to the Lender Loan Information. This went into effect on December 31, 2020. Learn more here.

Alaska and Hawaii Notarial Requirements for RON: Alaska recently passed a law to permit electronic recordings and remote notarizations. Multiple documents have been adjusted to include RON-specific language. Hawaii also adjusted their notary laws to remove the phrase “enabled by emergency order” in multiple forms. This went into effect on December 31, 2020. Learn more here.

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