How the new TILA-RESPA changes effect notaries

A major change in the mortgage lending industry will take effect in August of 2015. The Consumer Financial Protection Bureau (CFBP)amended requirements for the disclosures to borrowers. Lenders in the past have been required to provide disclosures to the borrowers when the loan application is submitted for new home purchases and re-finances. The borrower receives a Good Faith Estimate (GFE) and a Truth and Lending Disclosure Statement (TIL). When the closing takes place the borrower then receives a HUD-1 Settlement Statement (HUD)and a final TIL. As of 8-1-2015 those requirements are changing now when a loan application is submitted the borrower will receive the new Loan Estimate (3 pages) it replaces the GFE and the TIL. The new Loan Estimate must be sent to the borrowers within 3 days of submitting the loan application. At closing the new Closing Disclosure (CD) (5 pages) replaces the HUD-1 settlement statement and the final TIL and it must be delivered to the borrower 3 days prior to the closing appointment. That is great news for Notary Signing Agents, we should get the loan packages a few days before closing instead of at the last minute enabling us to schedule more closings. Also we will still see the old HUD and TIL forms for Home Equity Lines of Credit, Reverse Mortgages, Mobile Home Loans and any loans that have originated prior to 8-1-2015. Hopefully this will be a smooth transition for all of us. Sincerely, Lisa Scanlon, CSA

Scanlon Signing Services new location

Scanlon Signing Services now has a new location. As of 6-1-14 we now service Lee and Charlotte counties in Florida. You can still expect to get our accurate and professional service. We want your borrowers to have a great closing experience. I still personally perform all loan closings and have 10 years of signing experience. I am always on time and projecting that professional image that your customers expect. Please call on us for all of your loan closings in Lee and Charlotte counties in Florida. Our new office address is 7000 Marna lane North fort myers, fl 33917 Sincerely, Lisa Scanlon, CSA www.scanlonsigningservices.com 941-447-7130

New Standards for Notaries

Starting in 204 there will be a new set of standards for notaries that perform loan closings. The government is increasing its scrutiny of the mortgage industry and as a result they have created a set of standards called the Certified Signing Specialist Standards. A special committee called the Signing Professionals Workgroup or (SPW) which includes executives from major banks and title companies have set these standards. So far the new set of standards includes getting a yearly background check, errors and ommssions insurance of 25000.00 or more, passing an annual exam and scoring at least 80%, and following a standardized script. In the past signing agents have had to meet different requirements for each company they work for. The new set of standards should qualify signing agents to work for any company without having to get multiple background checks for each company. Sometime in 2014 the SPW will create the exam and choose who is able to offer the Certified Signing Specialist designation program. Lisa Scanlon, CSA

New CA thumbprint law

A new law recently enacted by Governor Jerry Brown will now require all California notaries to collect a thumbprint for any persons needing a notarization. This new law becomes effective on January 1, 2013. It also prohibits Notaries from performing a proof of execution by subscribing witness on any document that effects real property. The only other state at this time requiring a thumbprint is Illinois. But I am sure other states will soon follow. I strongly recommend obtaining thumbprints for all notarization's no matter what your state laws are at this time. The added security has proven to deter fraud and assist law enforcement in identifying suspects. Lisa Scanlon, CSA 941-447-7130 www.scanlonsigningservices.com

Mechanics liens being challenged

Two states (Rhode Island and Connecticut) recently invalidated mechanics liens against commercial properties because they were improperly notarized. An Acknowledgement was used instead of a Jurat. A Jurat requires the signer to give an oath or affirmation attesting to the truthfulness of the document. Notarizations are essential for mechanics lien statements across the United States but whether a mechanics lien does or does not need notarization varies from state to state. We must keep up with state laws and be aware of when an Acknowledgement is needed or a Jurat. Sincerely, Lisa Scanlon, CSA 941-447-7130 www.scanlonsigningservices.com

Federal Agency seeking comments on new mortgage proposals

The Consumer Financial Protection Bureau is seeking comments on a set of proposed rules designed to protect consumers from "robo-signing" and the foreclosures it caused. The federal agency states these new rules are a result of the foreclosure crisis and will effect how mortgage servicers do business. The proposals would create new rules under the Real Estate Settlement Procedures Act (RESPA) and the Truth and Lending Act (TILA) that requires extensive record keeping and mandates to offer consumers alternatives to foreclosure. Members of the public have until October 9th 2012 to comment on the rules. Lisa Scanlon, CSA 941-447-7130 www.scanlonsigningservices.com

FHA guidelines for Paying closing costs

These days many of the FHA Borrowers that I work with require Sellers to pay most of their Closing Costs, so I need to be on top of what the FHA Guideline On Seller Paid Closing Costs are. The FHA Guideline On Seller Paid Closing Costs are very specific, but could cause some last minute surprises if not explained correctly, and understood by the Borrower. FHA does not require that a Buyer put any of his or her own money towards Downpayment and/or Closing Cost. All of the money for Downpayment and Closing Costs can come from an acceptable gift source such as a: Family member Employer Non Profit State Bonded Program like CHFA in Connecticut FHA will not allow a Seller to contribute ANY money towards Downpayment, but they will allow the Seller to contribute up to 6% of the Sales Price towards the Buyers Closing Costs. This sounds good and it is, but I rarely see the Seller actually pay the Buyers Closing Costs. In reality what happens is the Seller raises the agreed upon Selling Price by the amount of the Closing Costs that they will be contributing. This means that even though the Buyer can receive up to 6% towards Closing Costs, they should not request any more than the actual amount of Closing Costs that the Seller will be allowed to pay at the Closing. If the Buyer asks for more money than the Seller will be allowed to contribute towards Closing Cost, the Seller gets to keep the difference, and the Buyer ends up paying more for the house than they needed to. This means that before a Buyer or their Realtor asks for Seller Paid Closing Costs, they need to talk to their Loan Originator, and have him or her give them a very close estimate of what the Total Closing Cost will actually be. In figuring the Estimated Closing Costs, the Loan Originator will need to take into account the Closing Cost that FHA will not allow the Seller to pay, and subtract them from the Total Closing Cost Estimate. The Closing Costs the will need to be deducted from the Total Closing Costs are any Closing Costs that are paid before the Closing. Those will include any fees paid to the Lender or other vendors prior to the Closing. Possible items that maybe required to be paid before of the Closing are: Appraisal Fee Application Fee Condo Questionnaire Homeowners Insurance There are other fees that could possibly be required to be paid before the Closing, but these are the most common ones. However, even though I have included Homeowners Insurance in the list above, there is away to include them into the costs that the Seller will contribute at the Closing. All Lenders will require that the Borrower obtain an insurance binder before the Closing, but they do not require that the premium be paid prior to the Closing as long as a check will be sent to the insurance company at the time of the Closing. However, some insurance companies will not issue the insurance binder without a payment, so what I advise my Borrowers to do in that case is to just pay them one month premium, and the other 11 months paid at the Closing. That way they can maximize the funds that that they can receive from the Seller, and reduce their out of pocket cost. I have heard of angry Buyers that did not find out until the Closing that they could not be reimbursed for the items that they paid before the Closing. That is not the type of surprise that anyone wants at the last minute. I make sure that my Borrowers understand this when I am Pre-Qualifying them, when I am doing the Mortgage Application with them, and after the loan is approved and they are now going to shop for Homeowners Insurance. I want them to take advantage of ALL the funds that the Seller has agreed to contribute, and I don't want an agree phone call from my Borrowers after the Closing. This is something that can not be explained enough, and should be reinforced at every appropriate opportunity. FHA Guideline On Seller Paid Closing Costs are very clear, and need to be followed, because FHA does not provide any flexibility when it comes to this issue. Lisa Scanlon, CSA