Metlife Home Loans
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MetLife Home Loans
Announcing New Regulations to Protect Homeowners
In 2008, Congress passed the Home Ownership and Equity Protection Act (HOEPA) and the
Housing and Economic Recovery Act (HERA). Both HOEPA and HERA contain new regulations designed to provide homebuyers with more information about their home loan choices. The Federal Reserve Board added the new regulations under the existing Truth-in-Lending (TIL) Act. In addition, FannieMae® and Freddie Mac adopted the Home Valuation Code of Conduct (HVCC) in 2009. The HVCC includes new regulations to enhance the integrity and accuracy of the home valuation process as performed by appraisers.
Effective May 1, 2009
New HVCC regulations require mortgage lenders to secure home appraisals with no influence on the selection of the appraiser. What’s more, to comply with HVCC, MetLife Home Loans (MLHL) is required to provide borrowers with a copy of their underwriter-accepted appraisal no less than 3 business days prior to the closing of their loan, unless a borrower signs a waiver (available in each mortgage office) agreeing to receive a copy of the appraisal at closing.
Effective July 30, 2009
New HERA regulations incorporated the Mortgage Disclosure Improvement Act (MDIA), which amends the Truth-In-Lending Act requirements for early and final disclosures to homebuyers. MDIA defines when specific fees related to the loan can be charged to the borrower, and requires a specific number of days to lapse after each borrower receives the TIL disclosure before the borrower can close (execute loan documents).
Change & Working Together MLHL is taking a pro-active approach to help borrowers, REALTORS®, appraisers, brokers, and closing agents understand these new requirements and how they affect the lending timeline process. If you have questions, please feel free to contact your local Relationship Manager or Account Executive. 1
Copy of the Appraisal to the Borrower Borrowers must be provided with a copy of their underwriter-accepted property appraisal a minimum of 3 business days before closing unless the borrower signs a waiver agreeing to receive a copy of the appraisal at closing.
More About Fees & Providing the Truth-in-Lending (TIL) Disclosure As of July 30, 2009, the only fee that can be collected before the borrower receives the initial TIL disclosure is the credit report fee. If the initial MetLife Home Loans (MLHL) TIL is provided in person to all borrowers/owners of record, the appraisal fee and any other fees may be collected, and the appraisal may be ordered any time after delivery of the TIL. The signed and dated TIL must be received by the mortgage office as proof of delivery. If the initial MLHL TIL disclosure is mailed*, the appraisal fee and any other up-front fees may be collected and the appraisal may be ordered on, or after, the 4th business day after the MLHL TIL has been mailed* to the borrower(s). If, however, all borrowers/owners of record sign, date, and return the MLHL TIL to the mortgage office, a credit card can be processed and the appraisal can be ordered upon receipt of the executed TIL by the mortgage office. The earliest the loan can close after the initial MLHL TIL disclosure is delivered is on the 7th business day after it has been mailed to the borrower(s). Throughout the processing phase, if fees change thereby causing an APR variance over or under .125% ( of 1%), a new MLHL TIL disclosure must be provided to the borrower. When MLHL re-discloses a corrected TIL disclosure by mailing it to all borrowers/owners in the transaction, the loan can close (documents can be signed) on, or after, the 6th business day. If all borrowers/owners of record sign, date, and return the executed TIL to the mortgage office, the loan can close on or after the 3rd business day. This will ensure the borrower has had time to reconsider their loan choice and feels confident moving forward with the loan. Since changes in fees may affect the APR and impact the closing date, it is recommended that all loans be locked at least 10 business days prior to the desired closing date. * For purposes of MLHL TIL disclosure delivery, the term, ‘mail’, includes all delivery methods except in person. In other words, ‘mail’ is e-mail, regular mail, express mail, overnight mail, and fax.
How the APR on the TIL Disclosure Affects the Loan’s Closing Date Within 3 days of receipt of an application, MLHL provides several disclosures—including a TIL—to all borrowers in the transaction. Borrowers must receive the initial MLHL TIL disclosure at least 7 business days (excluding Sundays and holidays) prior to closing. As previously stated, if the APR variance is over or under .125% ( of 1%) from the last TIL disclosure provided to the borrower, a new MLHL TIL must be provided to the borrower. After each TIL re-disclosure, the borrower must receive the revised TIL at least 3 business days prior to close. And, if the APR on the HUD-1 has a variance of .125% ( of 1%) from the last TIL provided to the borrower, a new, revised TIL must be provided to the borrower—and the closing cannot occur for 3 business days. There are many factors that could affect a loan’s APR: changes to the interest rate, loan product, closing date, loan amount, and fees, including title/closing and agent fees. Since a closing date could be jeopardized if the APR changes, it is critical for MLHL to obtain accurate loan and fee information as early as possible to ensure that the estimated fees that impact the APR and TIL are as accurate as possible.
2
Timelines for Successful Loan Transactions The calendar below illustrates the requirements for compliance with HVCC and MDIA for a primary residence transaction.
Sunday
2
Monday
3
23
Friday
Saturday
July 30
July 31
August 1
Application is taken on the phone. The borrower provides payment information for the credit report fee. The application is uploaded into MLHL’s loan origination system.
Reg Z Initial Disclosures
Reg Z Initial Disclosures Day 2
Day 1
5
6
7
8
MDIA-TIL Day 1
MDIA-TIL Day 2
MDIA-TIL Day 3
MDIA-TIL Day 4
MDIA-TIL Day 5
Day 3
If all borrowers/ owners sign, date & return the initial TIL to MLHL, payment information can be obtained for the appraisal fee & the appraisal can be ordered. Otherwise, payment information can be obtained & the appraisal can be ordered on the 4th day after delivery of the initial TIL.
If all borrowers/ owners sign, date & return the initial TIL to MLHL, payment information can be obtained for the appraisal fee & the appraisal can be ordered. Otherwise, payment information can be obtained & the appraisal can be ordered on the 4th day after delivery of the initial TIL.
If all borrowers/ owners sign, date & return the initial TIL to MLHL, payment information can be obtained for the appraisal fee & the appraisal can be ordered. Otherwise, payment information can be obtained & the appraisal can be ordered on the 4th day after delivery of the initial TIL.
Assuming all borrowers/owners did not sign & return the initial TIL, this is the earliest date allowed to collect the appraisal fee & order the appraisal.
10
11
12
13
14
15
MDIA-TIL Day 6
MDIA-TIL Day 7
The interest rate is locked with MLHL.
According to MDIA, this is the earliest date possible for the loan to close.
MLHL requests closing fee schedule from the settlement agent.
MLHL receives closing fee schedule from the settlement agent. The APR changes by more than of 1%.
MDIA-Corrected TIL–Day 1
MDIA-Corrected TIL–Day 2
MLHL mails all borrowers/owners a corrected TIL.
If all borrowers/owners sign, date & return the corrected TIL, the loan can close on, or after, the 3rd business day. Otherwise, the loan may close on, or after, the 6th business day.
If all borrowers/owners sign, date & return the corrected TIL, the loan can close on, or after, the 3rd business day. Otherwise, the loan may close on, or after, the 6th business day.
22
The borrower provides payment info for the appraisal. MLHL orders the appraisal.
17
18
19
20
21
MDIA-Corrected TIL– Day 3
MDIA-Corrected TIL– Day 4
MDIA-Corrected TIL– Day 5
MDIA-Corrected TIL– Day 6
MLHL receives underwriting approval.
If all borrowers/owners sign, date & return the corrected TIL, the loan can close on, or after, the 3rd business day. Otherwise, the loan may close on, or after, the 6th business day.
If all borrowers/owners sign, date & return the corrected TIL, the loan can close on, or after, the 3rd business day. Otherwise, the loan may close on, or after, the 6th business day.
If all borrowers/owners sign, date & return the corrected TIL, the loan can close on, or after, the 3rd business day. Otherwise, the loan may close on, or after, the 6th business day.
Assuming all borrowers/owners did not sign & return the corrected TIL, this is the earliest date the loan closing may occur.
Appraisal is received by MLHL.
MLHL submits complete file to Underwriting.
24
25
26
27
28
MLHL e-mails Underwriter-approved appraisal to borrower.
HVCC–Appraisal to borrower– Day 1
HVCC–Appraisal to borrower– Day 2
HVCC–Appraisal to borrower–Day 3
MLHL provides closing documents to settlement agent. All borrowers/owners sign documents. Date of funding varies based on loan purpose and state laws.
MLHL requests preliminary HUD-1 from settlement agent.
30
Thursday
4
Initial disclosures, including the TIL, are mailed to all borrowers/owners.
16
Wednesday
Reg Z Initial Disclosures
This is the latest date MLHL’s initial disclosures can be sent to all borrowers/owners of record.
9
Tuesday
31
MLHL receives preliminary HUD-1 & title. MLHL completes TIL worksheet & confirms APR is within .125 variance. This is the latest date borrower can sign waiver agreeing to receive appraisal at close.
1
This is the earliest possible date loan can close to comply with HVCC.
2
3
4
29
5
* Mail is any method other than delivered in person. Mail is considered received by the borrower in 6 days. ** Mail delivery of underwriter-accepted appraisal—and only appraisal—is considered received by borrower same day. In other words, when the TIL is e-mailed, mailed, express mailed, or overnight mailed, it is considered received by the borrower in 6 days.
3
Communication & Helping Others for All Involved With Loan Transaction Relationship Managers & Account Executives Can help borrowers, real estate agents, brokers and builders understand the new regulations and how they affect timelines and closing dates. By helping others understand their product options, initial disclosures, lock options, and TIL requirements, they will have realistic expectations upfront and throughout the loan process.
Title Companies & Closing Agents Can help by carefully quoting accurate fees and by providing mortgage offices with preliminary HUD-1 statements 10 days prior to scheduled closings.
Appraisers Can help by providing accurate fee quotes and delivering quality appraisals in a timely manner (5-7 business days).
Real Estate Agents & Builders Can help by educating borrowers and closing agents on the new regulations and how they affect timelines and closing dates.
Borrowers Can help by completing the loan application thoroughly and accurately. Borrowers should make sure that they understand their loan product options and have realistic expectations for re-disclosure of the TIL, delivery of the appraisal, and anticipated closing date options. Locking an interest rate early (more than 10 days before closing) is one way to reduce the risk of the APR changing and re-disclosure being required.
Still have questions? Review the attached Frequently Asked Questions, or contact your local Relationship Manager or Account Executive.
4
Q &A
MDIA Frequently Asked Questions Applications
Q: Can the loan be locked at the same time the application is taken? A: Yes.
Fees Q: A:
I am taking an application by phone. Can I collect credit card information for the appraisal fee while taking the application? No. Credit card information should not be collected from the borrower or broker (if applicable) for payment of the appraisal or any other up-front fees when taking the application. The only exception to this rule is the credit report fee. Credit card information can be collected from the borrower after all borrowers/owners of record receive the MetLife Home Loans (MLHL) initial Truth-in-Lending (TIL) disclosure. If the initial TIL is mailed, MLHL considers it to be received by the borrower on the 3rd business day, and the credit card information can be obtained on, or after, the 4th business day. If, however, all borrowers/owners of record sign, date, and return the MLHL TIL to the mortgage office, a credit card can be processed and the appraisal can be ordered upon receipt of the executed TIL.
Note: Throughout this document, the term, ‘mailed,’ means any delivery method other than face-to-face. In other words, ‘mailed’ means e-mail,
regular mail, fax, express mail, and overnight mail. And, the term, ‘business days,’ excludes Sundays and federal holidays.
Q: A:
When an application is taken face-to-face, can I collect credit card information for the appraisal fee? Assuming all borrowers/owners of record are present, immediately after providing all borrowers with initial disclosures—including the initial TIL—credit card information can be collected and processed for the appraisal fee and any other up front fees. The executed TIL by all borrowers/owners must be provided to MLHL as proof of receipt. If all borrowers are not present, the initial TIL must be mailed, and the credit card information can be obtained on, or after, the 4th business day.
Q: Can I accept a post-dated check for payment of the appraisal? A: No. MetLife Home Loans does not accept post-dated checks. Q: A:
Can seller-paid fees be collected any sooner than borrower-paid fees? Seller concessions should be appropriately indicated on the Good Faith Estimate. Seller concessions will be collected at closing. The appraisal cannot be ordered any earlier than the 4th business day unless all borrowers/owners of record execute the TIL and return it to the mortgage office—regardless of who will be paying the appraisal fee.
Dates Q: How does the new Mortgage Disclosure Improvement Act impact applications taken/received prior to July 30, 2009? A: Applications with a property address taken/received prior to July 30, 2009 are not impacted by MDIA. Q: When do the Initial Disclosures need to be provided to the borrower(s)? A: This has not changed. MetLife Home Loans’ initial disclosures, including the TIL, must be provided to borrowers no later than 3 business days after receipt of the application. Q: A:
After the Initial Disclosures have been provided to the borrower, how soon can I close (execute docs)? HVCC requires the borrower receive a copy of the underwriter accepted appraisal (or a signed waiver) a minimum of 3 days prior to close—and—MDIA requires the initial MetLife Home Loans TIL be provided to all borrowers at least 7 business days prior to closing. This, of course, is assuming no re-disclosure is required. If TIL re-disclosure is required, the closing may occur on the 6th business day after the corrected TIL is placed in the mail. If all borrowers/owners of record sign and date the TIL, the loan may close on, or after, the 3rd day after the TIL is executed and returned to the mortgage office.
5
Q: A:
If re-disclosure of the TIL is required, how soon can I close? If a corrected TIL is delivered in person to all borrowers/owners, the closing may occur anytime on or after the 3rd business day following delivery. If a corrected TIL is delivered or placed in the mail, the closing may occur on or after the 6th business day after the corrected TIL is placed in the mail. If the all borrowers/owners execute the TIL and return it to MLHL, the loan can close on the 3rd business day.
Q: Should I re-disclose a corrected TIL more than once? A: If necessary, yes. A corrected TIL is required when there is an APR variance over or under .125% ( of 1%)—and the mandatory 6-business-day waiting period is required every time a corrected TIL is placed in the mail. Q: If a TIL re-disclosure is mailed, and another change is made to the APR while the 6-day count to close is in progress, do I have to wait to update the TIL and re-disclose again? A: No. You can—and should—re-disclose any time the APR variance is over or under .125% ( of 1%). Q: A: Q: A:
How will MetLife Home Loans handle rushes? The minimum number of days to close a mortgage transaction is 7 business days after the initial disclosures are mailed or delivered. If the APR increases or decreases by .125% ( of 1%) throughout the loan process, a corrected TIL will be required. When corrected TILs are required, you can close on the 6th day after the TIL is put in the mail. If the all borrowers/owners execute the TIL and return it to MLHL, the loan can close on the 3rd business day after MLHL receives the TIL. This also assumes the underwriter-accepted appraisal has been provided to the borrower or a waiver to receive the appraisal at closing has been signed at least 3 business days prior to the close date. If a TIL re-disclosure is mailed, and another change is made to the APR while the 6-day count to close is in progress, do I have to wait to update the TIL and re-disclose again? No. You can—and should—re-disclose any time the APR variance is over under .125% ( of 1%) or more.
Q: Does MDIA affect the 3-day right of rescission? A: No. The right of rescission is still in effect for refinance transactions. The right of rescission period begins after closing (signing of docs).
Disclosures Q: If I have to re-disclose the TIL, do I also have to re-disclose the Good Faith Estimate? A: No. The TIL is the only document required for re-disclosure. Q: Do I have to provide the TIL to all borrowers/owners of record on the loan application? A: Yes. The TIL should be provided to all borrowers and buyers listed on the purchase contract AND all owners of record in title to the subject property at each individual applicant/owner’s mailing address. Q: How do I determine if a corrected TIL is required? A: To determine if a corrected TIL is required: > Compare the APR on the last TIL provided to the borrower to the APR now in TMO, or > Complete the Truth-In-Lending Compliance Worksheet, or > Compare the APR result using the Preliminary HUD-1 finance charges to the APR on the last TIL provided to the borrower.
If the APR is over or under by .125% ( period begins again.
of 1%), an updated TIL is required, and the appropriate mandatory waiting
All loans subject to approval. Certain conditions and fees apply. Mortgage financing provided by MetLife Home Loans, a division of MetLife Bank, N.A. Equal Housing Lender. ©2009 METLIFE, INC. L0709052148[exp0710][All States][DC]
6
10832
Announcing New Regulations to Protect Homeowners
In 2008, Congress passed the Home Ownership and Equity Protection Act (HOEPA) and the
Housing and Economic Recovery Act (HERA). Both HOEPA and HERA contain new regulations designed to provide homebuyers with more information about their home loan choices. The Federal Reserve Board added the new regulations under the existing Truth-in-Lending (TIL) Act. In addition, FannieMae® and Freddie Mac adopted the Home Valuation Code of Conduct (HVCC) in 2009. The HVCC includes new regulations to enhance the integrity and accuracy of the home valuation process as performed by appraisers.
Effective May 1, 2009
New HVCC regulations require mortgage lenders to secure home appraisals with no influence on the selection of the appraiser. What’s more, to comply with HVCC, MetLife Home Loans (MLHL) is required to provide borrowers with a copy of their underwriter-accepted appraisal no less than 3 business days prior to the closing of their loan, unless a borrower signs a waiver (available in each mortgage office) agreeing to receive a copy of the appraisal at closing.
Effective July 30, 2009
New HERA regulations incorporated the Mortgage Disclosure Improvement Act (MDIA), which amends the Truth-In-Lending Act requirements for early and final disclosures to homebuyers. MDIA defines when specific fees related to the loan can be charged to the borrower, and requires a specific number of days to lapse after each borrower receives the TIL disclosure before the borrower can close (execute loan documents).
Change & Working Together MLHL is taking a pro-active approach to help borrowers, REALTORS®, appraisers, brokers, and closing agents understand these new requirements and how they affect the lending timeline process. If you have questions, please feel free to contact your local Relationship Manager or Account Executive. 1
Copy of the Appraisal to the Borrower Borrowers must be provided with a copy of their underwriter-accepted property appraisal a minimum of 3 business days before closing unless the borrower signs a waiver agreeing to receive a copy of the appraisal at closing.
More About Fees & Providing the Truth-in-Lending (TIL) Disclosure As of July 30, 2009, the only fee that can be collected before the borrower receives the initial TIL disclosure is the credit report fee. If the initial MetLife Home Loans (MLHL) TIL is provided in person to all borrowers/owners of record, the appraisal fee and any other fees may be collected, and the appraisal may be ordered any time after delivery of the TIL. The signed and dated TIL must be received by the mortgage office as proof of delivery. If the initial MLHL TIL disclosure is mailed*, the appraisal fee and any other up-front fees may be collected and the appraisal may be ordered on, or after, the 4th business day after the MLHL TIL has been mailed* to the borrower(s). If, however, all borrowers/owners of record sign, date, and return the MLHL TIL to the mortgage office, a credit card can be processed and the appraisal can be ordered upon receipt of the executed TIL by the mortgage office. The earliest the loan can close after the initial MLHL TIL disclosure is delivered is on the 7th business day after it has been mailed to the borrower(s). Throughout the processing phase, if fees change thereby causing an APR variance over or under .125% ( of 1%), a new MLHL TIL disclosure must be provided to the borrower. When MLHL re-discloses a corrected TIL disclosure by mailing it to all borrowers/owners in the transaction, the loan can close (documents can be signed) on, or after, the 6th business day. If all borrowers/owners of record sign, date, and return the executed TIL to the mortgage office, the loan can close on or after the 3rd business day. This will ensure the borrower has had time to reconsider their loan choice and feels confident moving forward with the loan. Since changes in fees may affect the APR and impact the closing date, it is recommended that all loans be locked at least 10 business days prior to the desired closing date. * For purposes of MLHL TIL disclosure delivery, the term, ‘mail’, includes all delivery methods except in person. In other words, ‘mail’ is e-mail, regular mail, express mail, overnight mail, and fax.
How the APR on the TIL Disclosure Affects the Loan’s Closing Date Within 3 days of receipt of an application, MLHL provides several disclosures—including a TIL—to all borrowers in the transaction. Borrowers must receive the initial MLHL TIL disclosure at least 7 business days (excluding Sundays and holidays) prior to closing. As previously stated, if the APR variance is over or under .125% ( of 1%) from the last TIL disclosure provided to the borrower, a new MLHL TIL must be provided to the borrower. After each TIL re-disclosure, the borrower must receive the revised TIL at least 3 business days prior to close. And, if the APR on the HUD-1 has a variance of .125% ( of 1%) from the last TIL provided to the borrower, a new, revised TIL must be provided to the borrower—and the closing cannot occur for 3 business days. There are many factors that could affect a loan’s APR: changes to the interest rate, loan product, closing date, loan amount, and fees, including title/closing and agent fees. Since a closing date could be jeopardized if the APR changes, it is critical for MLHL to obtain accurate loan and fee information as early as possible to ensure that the estimated fees that impact the APR and TIL are as accurate as possible.
2
Timelines for Successful Loan Transactions The calendar below illustrates the requirements for compliance with HVCC and MDIA for a primary residence transaction.
Sunday
2
Monday
3
23
Friday
Saturday
July 30
July 31
August 1
Application is taken on the phone. The borrower provides payment information for the credit report fee. The application is uploaded into MLHL’s loan origination system.
Reg Z Initial Disclosures
Reg Z Initial Disclosures Day 2
Day 1
5
6
7
8
MDIA-TIL Day 1
MDIA-TIL Day 2
MDIA-TIL Day 3
MDIA-TIL Day 4
MDIA-TIL Day 5
Day 3
If all borrowers/ owners sign, date & return the initial TIL to MLHL, payment information can be obtained for the appraisal fee & the appraisal can be ordered. Otherwise, payment information can be obtained & the appraisal can be ordered on the 4th day after delivery of the initial TIL.
If all borrowers/ owners sign, date & return the initial TIL to MLHL, payment information can be obtained for the appraisal fee & the appraisal can be ordered. Otherwise, payment information can be obtained & the appraisal can be ordered on the 4th day after delivery of the initial TIL.
If all borrowers/ owners sign, date & return the initial TIL to MLHL, payment information can be obtained for the appraisal fee & the appraisal can be ordered. Otherwise, payment information can be obtained & the appraisal can be ordered on the 4th day after delivery of the initial TIL.
Assuming all borrowers/owners did not sign & return the initial TIL, this is the earliest date allowed to collect the appraisal fee & order the appraisal.
10
11
12
13
14
15
MDIA-TIL Day 6
MDIA-TIL Day 7
The interest rate is locked with MLHL.
According to MDIA, this is the earliest date possible for the loan to close.
MLHL requests closing fee schedule from the settlement agent.
MLHL receives closing fee schedule from the settlement agent. The APR changes by more than of 1%.
MDIA-Corrected TIL–Day 1
MDIA-Corrected TIL–Day 2
MLHL mails all borrowers/owners a corrected TIL.
If all borrowers/owners sign, date & return the corrected TIL, the loan can close on, or after, the 3rd business day. Otherwise, the loan may close on, or after, the 6th business day.
If all borrowers/owners sign, date & return the corrected TIL, the loan can close on, or after, the 3rd business day. Otherwise, the loan may close on, or after, the 6th business day.
22
The borrower provides payment info for the appraisal. MLHL orders the appraisal.
17
18
19
20
21
MDIA-Corrected TIL– Day 3
MDIA-Corrected TIL– Day 4
MDIA-Corrected TIL– Day 5
MDIA-Corrected TIL– Day 6
MLHL receives underwriting approval.
If all borrowers/owners sign, date & return the corrected TIL, the loan can close on, or after, the 3rd business day. Otherwise, the loan may close on, or after, the 6th business day.
If all borrowers/owners sign, date & return the corrected TIL, the loan can close on, or after, the 3rd business day. Otherwise, the loan may close on, or after, the 6th business day.
If all borrowers/owners sign, date & return the corrected TIL, the loan can close on, or after, the 3rd business day. Otherwise, the loan may close on, or after, the 6th business day.
Assuming all borrowers/owners did not sign & return the corrected TIL, this is the earliest date the loan closing may occur.
Appraisal is received by MLHL.
MLHL submits complete file to Underwriting.
24
25
26
27
28
MLHL e-mails Underwriter-approved appraisal to borrower.
HVCC–Appraisal to borrower– Day 1
HVCC–Appraisal to borrower– Day 2
HVCC–Appraisal to borrower–Day 3
MLHL provides closing documents to settlement agent. All borrowers/owners sign documents. Date of funding varies based on loan purpose and state laws.
MLHL requests preliminary HUD-1 from settlement agent.
30
Thursday
4
Initial disclosures, including the TIL, are mailed to all borrowers/owners.
16
Wednesday
Reg Z Initial Disclosures
This is the latest date MLHL’s initial disclosures can be sent to all borrowers/owners of record.
9
Tuesday
31
MLHL receives preliminary HUD-1 & title. MLHL completes TIL worksheet & confirms APR is within .125 variance. This is the latest date borrower can sign waiver agreeing to receive appraisal at close.
1
This is the earliest possible date loan can close to comply with HVCC.
2
3
4
29
5
* Mail is any method other than delivered in person. Mail is considered received by the borrower in 6 days. ** Mail delivery of underwriter-accepted appraisal—and only appraisal—is considered received by borrower same day. In other words, when the TIL is e-mailed, mailed, express mailed, or overnight mailed, it is considered received by the borrower in 6 days.
3
Communication & Helping Others for All Involved With Loan Transaction Relationship Managers & Account Executives Can help borrowers, real estate agents, brokers and builders understand the new regulations and how they affect timelines and closing dates. By helping others understand their product options, initial disclosures, lock options, and TIL requirements, they will have realistic expectations upfront and throughout the loan process.
Title Companies & Closing Agents Can help by carefully quoting accurate fees and by providing mortgage offices with preliminary HUD-1 statements 10 days prior to scheduled closings.
Appraisers Can help by providing accurate fee quotes and delivering quality appraisals in a timely manner (5-7 business days).
Real Estate Agents & Builders Can help by educating borrowers and closing agents on the new regulations and how they affect timelines and closing dates.
Borrowers Can help by completing the loan application thoroughly and accurately. Borrowers should make sure that they understand their loan product options and have realistic expectations for re-disclosure of the TIL, delivery of the appraisal, and anticipated closing date options. Locking an interest rate early (more than 10 days before closing) is one way to reduce the risk of the APR changing and re-disclosure being required.
Still have questions? Review the attached Frequently Asked Questions, or contact your local Relationship Manager or Account Executive.
4
Q &A
MDIA Frequently Asked Questions Applications
Q: Can the loan be locked at the same time the application is taken? A: Yes.
Fees Q: A:
I am taking an application by phone. Can I collect credit card information for the appraisal fee while taking the application? No. Credit card information should not be collected from the borrower or broker (if applicable) for payment of the appraisal or any other up-front fees when taking the application. The only exception to this rule is the credit report fee. Credit card information can be collected from the borrower after all borrowers/owners of record receive the MetLife Home Loans (MLHL) initial Truth-in-Lending (TIL) disclosure. If the initial TIL is mailed, MLHL considers it to be received by the borrower on the 3rd business day, and the credit card information can be obtained on, or after, the 4th business day. If, however, all borrowers/owners of record sign, date, and return the MLHL TIL to the mortgage office, a credit card can be processed and the appraisal can be ordered upon receipt of the executed TIL.
Note: Throughout this document, the term, ‘mailed,’ means any delivery method other than face-to-face. In other words, ‘mailed’ means e-mail,
regular mail, fax, express mail, and overnight mail. And, the term, ‘business days,’ excludes Sundays and federal holidays.
Q: A:
When an application is taken face-to-face, can I collect credit card information for the appraisal fee? Assuming all borrowers/owners of record are present, immediately after providing all borrowers with initial disclosures—including the initial TIL—credit card information can be collected and processed for the appraisal fee and any other up front fees. The executed TIL by all borrowers/owners must be provided to MLHL as proof of receipt. If all borrowers are not present, the initial TIL must be mailed, and the credit card information can be obtained on, or after, the 4th business day.
Q: Can I accept a post-dated check for payment of the appraisal? A: No. MetLife Home Loans does not accept post-dated checks. Q: A:
Can seller-paid fees be collected any sooner than borrower-paid fees? Seller concessions should be appropriately indicated on the Good Faith Estimate. Seller concessions will be collected at closing. The appraisal cannot be ordered any earlier than the 4th business day unless all borrowers/owners of record execute the TIL and return it to the mortgage office—regardless of who will be paying the appraisal fee.
Dates Q: How does the new Mortgage Disclosure Improvement Act impact applications taken/received prior to July 30, 2009? A: Applications with a property address taken/received prior to July 30, 2009 are not impacted by MDIA. Q: When do the Initial Disclosures need to be provided to the borrower(s)? A: This has not changed. MetLife Home Loans’ initial disclosures, including the TIL, must be provided to borrowers no later than 3 business days after receipt of the application. Q: A:
After the Initial Disclosures have been provided to the borrower, how soon can I close (execute docs)? HVCC requires the borrower receive a copy of the underwriter accepted appraisal (or a signed waiver) a minimum of 3 days prior to close—and—MDIA requires the initial MetLife Home Loans TIL be provided to all borrowers at least 7 business days prior to closing. This, of course, is assuming no re-disclosure is required. If TIL re-disclosure is required, the closing may occur on the 6th business day after the corrected TIL is placed in the mail. If all borrowers/owners of record sign and date the TIL, the loan may close on, or after, the 3rd day after the TIL is executed and returned to the mortgage office.
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Q: A:
If re-disclosure of the TIL is required, how soon can I close? If a corrected TIL is delivered in person to all borrowers/owners, the closing may occur anytime on or after the 3rd business day following delivery. If a corrected TIL is delivered or placed in the mail, the closing may occur on or after the 6th business day after the corrected TIL is placed in the mail. If the all borrowers/owners execute the TIL and return it to MLHL, the loan can close on the 3rd business day.
Q: Should I re-disclose a corrected TIL more than once? A: If necessary, yes. A corrected TIL is required when there is an APR variance over or under .125% ( of 1%)—and the mandatory 6-business-day waiting period is required every time a corrected TIL is placed in the mail. Q: If a TIL re-disclosure is mailed, and another change is made to the APR while the 6-day count to close is in progress, do I have to wait to update the TIL and re-disclose again? A: No. You can—and should—re-disclose any time the APR variance is over or under .125% ( of 1%). Q: A: Q: A:
How will MetLife Home Loans handle rushes? The minimum number of days to close a mortgage transaction is 7 business days after the initial disclosures are mailed or delivered. If the APR increases or decreases by .125% ( of 1%) throughout the loan process, a corrected TIL will be required. When corrected TILs are required, you can close on the 6th day after the TIL is put in the mail. If the all borrowers/owners execute the TIL and return it to MLHL, the loan can close on the 3rd business day after MLHL receives the TIL. This also assumes the underwriter-accepted appraisal has been provided to the borrower or a waiver to receive the appraisal at closing has been signed at least 3 business days prior to the close date. If a TIL re-disclosure is mailed, and another change is made to the APR while the 6-day count to close is in progress, do I have to wait to update the TIL and re-disclose again? No. You can—and should—re-disclose any time the APR variance is over under .125% ( of 1%) or more.
Q: Does MDIA affect the 3-day right of rescission? A: No. The right of rescission is still in effect for refinance transactions. The right of rescission period begins after closing (signing of docs).
Disclosures Q: If I have to re-disclose the TIL, do I also have to re-disclose the Good Faith Estimate? A: No. The TIL is the only document required for re-disclosure. Q: Do I have to provide the TIL to all borrowers/owners of record on the loan application? A: Yes. The TIL should be provided to all borrowers and buyers listed on the purchase contract AND all owners of record in title to the subject property at each individual applicant/owner’s mailing address. Q: How do I determine if a corrected TIL is required? A: To determine if a corrected TIL is required: > Compare the APR on the last TIL provided to the borrower to the APR now in TMO, or > Complete the Truth-In-Lending Compliance Worksheet, or > Compare the APR result using the Preliminary HUD-1 finance charges to the APR on the last TIL provided to the borrower.
If the APR is over or under by .125% ( period begins again.
of 1%), an updated TIL is required, and the appropriate mandatory waiting
All loans subject to approval. Certain conditions and fees apply. Mortgage financing provided by MetLife Home Loans, a division of MetLife Bank, N.A. Equal Housing Lender. ©2009 METLIFE, INC. L0709052148[exp0710][All States][DC]
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