March 2021 Compliance Roundup

March was a busy month for our compliance professionals. We saw a number of changes from the nation’s largest mortgage investors (FNMA and FHLMC) and a number of States. The changes are detailed below.

Remember that you will always be up to date, up to the minute, by following the posts in our compliance blog. And now for the compliance and document changes we saw in March.

Investor and Regulatory Compliance News
We saw regulators and investors making some changes in March. In particular, we saw a number of states giving attention to their Remote Online Notarization (RON) laws. Here is what happened in March:

Arizona. Gov. Doug Ducey signed AZ S.B. 1115 (2021) into law. The new law repeals the Uniform Recognition of Acknowledgments Act and Articles 3 and 4 of Chapter 2, Title 41 of Arizona’s Revised Statutes (Electronic Notarizations and Remote Online Notarizations, respectively), and incorporates similar provisions into other parts of Title 41. We are currently reviewing these amendments to determine any impact, and evaluating any modifications, to our document library and/or systems. Learn more.

Fannie Mae & Freddie Mac. Despite Fannie Mae’s and Freddie Mac’s early guidance that URLA sections should be kept together as much as possible, some combinations of variable heights, as added to page footers, table footers, and table contents, can very infrequently cause a printing error in one sub-section. We have thus modified the formatting of Section 2 to allow for individual sub-sections to split across pages as necessary. This is in keeping with the Rendering Options for the Uniform Residential Loan Application (URLA) document provided by FNMA. The updated documents are now available in ConformX. Learn more.

In other GSE compliance news: On March 11, 2021, FNMA revised LL-2021-03 (their “master letter” covering temporary requirements to, and flexibilities for, origination processes, due to the COVID-19 Pandemic) and announced that their temporary rules for verbal verifications of employment and power of attorney would be extended to Apr. 30, 2021 but not beyond that. FHLMC also announced in Bulletin 2021-10 that they will not be extending, past April 30, 2021, some of the temporary flexibilities they allowed due to the COVID-19 Pandemic. We are currently reviewing these announcements to determine any impact, and evaluating any modifications, to our document library and/or systems. Learn more. 

South Dakota. Gov. Kristi Noem signed SD S.B. 193 (2021) into law. The new law promulgates a new notarial certificate to be used in connection with Remote Online Notarizations. This bill takes effect on July 1, 2021.We are currently reviewing this bill to determine any impact and evaluating any modifications to our document library and/or systems. Learn more.

Virginia. Gov. Ralph Northam signed VA HB 2064 (2021) into law. The new law amends various parts of Virginia’s Code regarding electronic recordings and notarizations, such as requiring an indication within a notarial certificate as to whether the notarization was done in person or via Remote Online Notarization (aka “RON”). We are currently reviewing this bill to determine any impact, and evaluating any modifications, to our document library and/or systems. Learn more.

In other Virginia compliance news: Gov. Ralph Northam approved VA H.B. 1882 (2021) in February. This impacts several rules regarding deeds of trust, including whether amendments and modifications to loan documents must be recorded if the deed of trust states that it secures any additional amendments and modifications, slightly modifying the subordinate language for refinance mortgages, and requiring the interest rate of the prior mortgage to be stated on the first page of the refinance mortgage. We are currently reviewing this bill to determine any impact, and evaluating any modifications, to our document library and/or systems. Learn more.

Wyoming. Gov. Mark Gordon signed WY H.B. 0008 (2021) into law in February, which amends various sections of the Wyoming-version of the Uniform Consumer Credit Code. Among these changes are amendments to the definition of a “loan primarily secured by an interest in land.” We are currently reviewing this bill to determine any impact, and evaluating any modifications, to our document library and/or systems. Learn more.

Other Document Changes
Our compliance team delivered a number of document updates in March, many related to our normal monthly audits of important investor and regulator documents. The changes have been summarized below with links to the full descriptions of the updates. 

• Pursuant to our monthly audit of VA forms, we will be making a number of changes to form Cx16049. The changes went into effect on March 31. Learn more.
• Our monthly audit of USDA documents has led us to make a number of changes to “USDA/RD Origination Stacking Order Checklist – Attachment 15-A” (Cx19212). We have also modified the revision dates on “Lender Certification For SFH Guaranteed Loan” (Cx3818), “Loan Note Guarantee – Form RD 3555-17” (Cx18891), and “Conditional Commitment for SFH Loan Guarantee – RD 3555-18” (Cx18892) from “01-21” to “03-21”. Learn more.
• The S. Department of Agriculture had posted on their website draft revisions of their Forms RD 3555-17, 3555-18, and 3555-21. USDA Procedure Notice 548 (March 1, 2021) announced that these revisions had been officially made, with the latest versions of the forms available on the USDA’s website. Due to these changes, we will be modifying our copies of these forms to match the latest versions. Learn more.
• After our monthly audit of HUD documents, we have made a number of document changes to make them conform more with HUD’s official forms. These documents include HUD-92544 (Cx47), HUD-92541 (Cx3971), Conditional Commitment Direct Endorsement (Cx4566 & Cx4733) and others. Learn more.
• We will be modifying Cx3525 to more closely align with the latest revision of the “Fee Agreement Sample” from the South Carolina Department of Consumer Affairs. Learn more.
• Our monthly audit of GSE and Federal Agency forms has resulted in our decision to update our copies of the Mortgagee’s Assurance of Completion (Cx3556) and Compliance Inspection Report (Cx14697) forms to match the latest versions of their corresponding HUD forms. Learn more.
• Based on a memo from the Chief Title Examiner from the Massachusetts Land Court, we are updating the notary blocks on our Massachusetts Security Instruments to use the General notary block language provided in Mass. Gen. Laws Ann. ch. 222, § 15, if the property is registered land. This change impacts MA documents Cx328, Cx486, Cx1332, and Cx19379. Learn more.

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