Compliance Updates: May 2024 In Review

Our team of experts at Docutech continually review requirements for document changes and publish real-time updates. To help keep you in the know, the monthly Docutech Compliance Recap brings you the most recent compliance updates. 

Here’s our latest recap: 

Document Updates

• CA Insurance Code § 770 prohibits a lender to require the use of a particular insurance agent or broker. Additionally, § 772 requires the borrower to be given a written statement disclosing that the borrower has a choice in the insurance agent or broker that is used. § 772 further provides that it is prima facie evidence of compliance if the borrower gives the name of his/her chosen insurance agent or broker in his/her own handwriting. Docutech provides Cx2350 “CA Hazard Insurance Disclosure” for compliance with these sections. Read more.
• We made a minor update on Cx25287 (DC Mortgage Deed of Trust) and Cx26124 (DC FHA Deed of Trust) by adding a field to disclose the subdivision. The FNMA model form (3009) in the Transfer of Rights in the Property Section has a space to input the lot, square and subdivision. The lot and square sections provide a blank space for data input, but the subdivision section does not provide a blank space, it only has a colon. We have added field 61631 Subdivision name to print the subdivision after the colon. Read more.
• We made changes to Wisconsin Disclosures Cx2783 Advanced Fee/Application Disclosure Form and retired the. Cx3951 Wisconsin Adjustable-Rate Mortgage Information Statement. Read more.
• Pursuant to our monthly audit of federal agency forms, we have updated Cx19212 “USDA/RD Origination Stacking Order Checklist – Attachment 15-A.” and Cx18894 “Guaranteed Rural Housing Lender Record Change – RD 3555-11”. Read more.
• eSign Available for Right to Choose Attorney (Cx3846) & Illinois Right to Choose Title Insurance (Cx1097). With Docutech’s ongoing effort to make all generic documents in its library electronically signable, Cx3846 “Right to Choose Attorney” and Cx1097 “IL Right to Choose Title Insurance” are now available with a generic option for eSign. Read more.
• Fannie Mae has updated their instructions for the Loan Modification Agreement (Form 3179). These changes include the required inclusion of two new provisions for mortgage loans secured by property in New York and updated provisions related to MERS. While these instructions were updated only for Fannie Mae’s Fixed Loan Modification Agreement (FNMA Form 3179), we have made the same changes to our ARM Loan Modification Agreements (FNMA Form 3161) for consistency and compliance with state laws. Read more.
• As previously announced, Docutech has created a new document, cx27569, in response to the Department of Veterans Affairs’ Circular 26-24-9, which introduced new VA-Form 26-10291 Assumption Entitlement Acknowledgement. This new document mirrors the VA Form in formatting and content. Read more.

Global Mapping Changes

• Docutech continues to update our document library and system settings to modernize documents and make them as consistent as possible with the 2021 versions of the GSE uniform instruments. Changes are being made to remove old settings related to the pre-2021 uniform instruments and support the implementation of our revised FHA instruments. Read more.

Compliance News

• On April 25, 2024, the Department of Veterans Affairs released Circular 26-24-9. This circular discusses a new VA Form 26-10291 – Assumption Entitlement Acknowledgement. The purpose of the new form is to remind veterans that when their home is assumed by a non-veteran borrower, the entitlement stays with the home and they will not be able to purchase another home with a VA loan until the first loan is paid in full. The circular states that the form may be used now, but will be required 60 days from the publication of the circular, which is June 24, 2024. We are currently reviewing this change to determine any impact to our document library and/or systems and evaluating any necessary changes. Read more.
• On May 1, 2024, the Federal Housing Finance Agency released an announcement regarding Enterprise Reconsideration of Value policies. Lenders are to implement ROV policies by August 29, 2024, for Fannie Mae and Freddie Mac, and by September 2, 2024, for HUD. Docutech is currently reviewing these policy changes to determine any impact to its document library and/or systems. Read more.

For full details related to document and mortgage compliance updates, sign up for real-time Compliance updates at info.docutech.com/subscribe-compliance.

The above information is for informational purposes only and is not and may not be construed as legal advice. No third-party entity may rely upon anything contained herein when making legal and/or other determinations regarding its practices, and such third party should consult with an attorney prior to embarking upon any specific course of action.