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| Proposed Residential Mortgage Loan Originator Regulations | | | Published : 03/08/2010 | | The Finance Commission of Texas (“Finance Commission”) proposes amendments to Sections 80.1, 80.2, 80.8, 80.9, 80.10, 80.11, 80.12, 80.13, 80.14, 80.15, 80.20, 80.21, 80.22, and 80.23 of the Mortgage Broker and Loan Officer Licensing regulations contained in the Texas Administrative Code at 7 TAC Chapter 80. In addition, the Finance Commission proposes new Subchapter L, Licensing, Sections 80.301, 80.302, 80.303, 80.304, 80.305, 80.306, and 80.307. The text of these proposed amended and new regulations (“Proposed Rules”) may be found in the above cited issue of the Texas Register, and you are advised to read these Proposed Rules and not rely on the summary contained in this memorandum. | | Full Article and Downloads | | | | |
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| Mortgage Banker Registration and Loan Officer Licensing | | | Published : 01/22/2010 | Effective January 7, 2010, the Finance Commission of Texas amended the Mortgage Banker Rules (Rules) contained in the Texas Administrative Code, 7 TAC Chapter 81. Sections 81.1 and 81.2 of the Rules are amended and new Rules 81.3 through 81.19 are added. The text of these amended and new rules are attached to this memorandum.
The amended and new Rules were adopted by the Finance Commssion to implement the provisions of House Bills 10, 963 and 2779 passed by the 81st Texas Legislature (see our November 13, 2009 memorandum on House Bills 10 and 2779) and to assist the Texas Department of Savings and Mortgage Lending (TDSML) in preparing to participate in the National Mortgage License System Registry. House Bills 10 and 2779 make substantial modifications to Chapter 157 of the Finance Code (Mortgage Banker Registration and Residential Mortgage Loan Originator License Act) relating to the registration and regulation of mortgage bankers and residential mortgage loan originators. These amended and new Rules substantially mirror the current Mortgage Broker and Loan Officer Licensing rules in the Texas Administrative Code, 7 TAC Chapter 80, (see our November 13, 2009 memorandum). The amended and new Rules relate to the following sections of Chapter 157 of the Finance Code: Sections 157.001, 157.002, 157.007, 157.008, 157.012, 157.015, 157.016, 157.020, and 157.021.
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| Discount Points - Discount Points are not included in Home Equity Cap | | | Published : 01/11/2010 | | On January 8, 2009, the Texas Court of Appeals, Third District, at Austin, issued its opinion1 in the civil suit filed by the Association of Community Organizations for Reform Now (ACORN) seeking to invalidate a number of the home equity interpretations (Rules) issued jointly by the Finance Commission of Texas and the Credit Union Commission of Texas (Commissions). The ACORN opinion, in addition to other decisions affecting the Rules that will be the subject of a later memorandum, affirmed the trial court’s judgment invalidating Rule 153.1(11), which defines “interest” for purposes of the three percent fee cap imposed by Section 50(a)(6)(E) of Article XVI of the Texas Constitution (3% fee cap). Rule 153.1(11) defines interest to be “interest as defined in the Texas Finance Code §301.002(4) [sic] and as interpreted by the courts.” Section 301.002(a)(4) defines interest, in pertinent part, as “compensation for the use, forbearance, or detention of money.” | | Full Article and Downloads | | | | |
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| FHA Mortgagee Letter 2009-53 – Origination Fee Cap Removed | | | Published : 01/04/2010 | | On December 30, 2009, FHA, in accordance with the regulatory changes to 24 CFR §203.27, issued M.L. 2009-53 that, among other matters, removed the one percent origination fee cap for FHA’s standard mortgage insurance programs. The Home Equity Conversion Mortgage (HECM) and the Section 203(k) Rehabilitation Mortgage Insurance programs retain their statutory origination fee caps. As noted in No. 2 below, in order to correct a misstatement, FHA revised M.L. 2009-53. The full text of revised M.L. 2009-53, which is attached to this memorandum, is briefly summarized below: | | Full Article and Downloads | | | | |
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| Good Faith Estimate Forms | | | Published : 12/22/2009 | We have posted three sample forms for use with the new GFE. They are:
(1) Notification of Expiration of Good Faith Estimate - Suggest to be used when 10 business days have passed and the borrower has not expressed an intent to proceed.
(2) Receipt of GFE - Lenders are prohibited from including a signature line on the new GFE. This form allows the borrower to express an immediate intent (yes or no) or provides evidence of receipt for the running of the ten business day period.
(3) Written List of Providers – As to certain settlement providers for whom borrowers can shop, this is a suggested form for the required disclosure to the borrower.
(4) Sample Closing Instructions - Sample Black, Mann & Graham L.L.P. Closing Instructions
(5) Change Circumstance - Changed Circumstance or Borrower Requested Change Letter
(6) Construction Disclosure - Construction Disclosure
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| SAFE Act - Regulation of Texas Residential Mortgage Loan Originators | | | Published : 11/13/2009 | This is the second legislative update from the 81st Regular Session of the Texas Legislature, 2009, prepared by this firm and summarizes House Bills 10, 2774, and 2779 that provide for the regulation of Texas residential mortgage loan originators in order to comply with the federal Secure and Fair Enforcement for Mortgage Licensing Act of 2008 (SAFE Act) enacted by Congress on July 30, 2008. | | Full Article and Downloads | | | | |
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| The New GFE Video | | | Published : 11/09/2009 | 
On November 17, 2008, the Department of Housing and Urban Development (“HUD”) published in the Federal Register (pages 68204 - 68288) its final rule (“final rule”) amending Regulation X. The final rule has two effective dates. Certain sections of the final rule are effective January 16, 2009 (and were the subject of our November 26, 2008 memorandum), and other sections of the final rule are effective January 1, 2010. Except for the brief discussion of HUD’s recent withdrawal of the final rule’s revised definition of “required use,” this memorandum will address those final rule changes that are effective January 1, 2010.
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| The New HUD-1 Video | | | Published : 11/09/2009 | 
On November 17, 2008, the Department of Housing and Urban Development (“HUD”) published in the Federal Register (pages 68204 - 68288) its final rule (“final rule”) amending Regulation X. The final rule has two effective dates. Certain sections of the final rule are effective January 16, 2009 (and were the subject of our November 26, 2008 memorandum), and other sections of the final rule are effective January 1, 2010. Except for the brief discussion of HUD’s recent withdrawal of the final rule’s revised definition of “required use,” this memorandum will address those final rule changes that are effective January 1, 2010.
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| New and Amended Mineral Interests Rules, Rates, and Endorsements by the Texas Department of Insurance, effective November 1, 2009 | | | Published : 10/28/2009 | In the August 28, 2009 issue of the Texas Register, the Texas Department of Insurance (TDI) adopted new rules and endorsement forms and modified currently existing rules for mineral interests affecting Texas properties as part of the Basic Manual of Rules, Rates and Forms for the Writing of Title Insurance in the State of Texas (Basic Manual). These procedural rules, rates, and endorsement forms relating to mineral interests become effective November 1, 2009, and are identified as follows: amended Texas Title Insurance Information page; new Procedural Rule P-5.1; amended Procedural Rule P-50; new Procedural Rule P-50.1; new Minerals and Surface Damage Endorsement Form T-19.2; new Minerals and Surface Damage Endorsement Form T-19.3; amended Rate Rule R-29; and new Rate Rule R-29.1. | | Full Article and Downloads | | | | |
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| Monthly Interest Accrual Amortization - Payment of Interest after Prepayment in full not a Prepayment Penalty | | | Published : 10/05/2009 | In a September 29, 2009, letter to the Secretary of the U.S. Department of Housing and Urban Development (HUD), the Director of the Division of Consumer and Community Affairs of the Federal Reserve Board (FRB) stated that for loans that use the monthly interest accrual amortization method for allocating a payment to accrued interest and principal, the payment of interest after a loan is prepaid in full is not a prepayment penalty under Regulation Z. Under the monthly interest accrual amortization method, all loan payments are treated as having been made on the scheduled due date regardless of when made, provided the payment is made prior to the expiration of the payment grace period. Under this method if a payment is made early it is still treated as having been paid on the payment due date and the consumer does not receive any reduction in interest due. Likewise, if the payment is made after the due date, but during the payment grace period, the consumer is not charged any additional interest. | | Full Article and Downloads | | | | |
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| Regulation Z – New Whole Loan Sale Disclosure Notice, Effective May 20, 2009. | | | Published : 07/30/2009 | On May 20, 2009, the President signed into law the “Helping Families Save Their Homes Act of 2009” (Public Law 111-22). Section 404(a) of the Act amends Section 131 of the Truth in Lending Act (TILA) to require that a borrower be notified in writing not later than 30 days after the borrower’s mortgage loan has been sold, transferred, or assigned. The notice must include information identifying the new creditor, the date of transfer, how to reach the new creditor, the location of where the transfer of the loan is recorded, and other relevant information regarding the new creditor. The new creditor is required to give this notice and the notice applies only to a consumer loan secured by the borrower’s principal dwelling. | | Full Article and Downloads | | | | |
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