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2015 Summer Newsletter

2015 Summer Newsletter

June 3, 2015 Posted by admin

What’s New:

Things are finally starting to thaw out and warm up. The selling season is also beginning to heat up and we are seeing things get busier and busier. We are hoping for a strong summer season for everyone.

According to the American Land Title Association (ALTA), June is National Homeownership Month. Let’s continue to help more people achieve the American Dream of homeownership!

The big news that is affecting all aspects of real estate transactions right now is the looming deadline of August 1, 2015, which signals the implementation of the CFPB/TRID changes. By now, you have either heard about the changes or attended one of our in-person or online presentations explaining the changes and how the changes will be directly affecting our real estate closing transactions in the near future. A major emphasis of these changes affects the documentation used during the loan and closing processes and sets specific timelines for their delivery. More information on this below.

 

Market News:

Mortgage rates have been steady or slightly lower in past weeks, with mortgage applications decreasing slightly, according to Freddie Mac and the Mortgage Bankers Association (“MBA”). The MBA estimates a total of $1.2 trillion in mortgage originations for 2015. For 2016, the MBA projects $1.17 trillion in origination volume.  In addition, the average single-family home increased in size demonstrating a change in the trend for smaller dwellings, according to the National Association of Home Builders.

CFPB Closing Disclosure Implementation: The new form changes to the GFE, TIL and HUD-1, came as a result of the need to have consumers/borrowers understand their loan and real estate closing forms better, allow for better comparison shopping by the borrower between lenders and to help prevent surprises at closing for a borrower. The new Loan Estimate (which replaces the GFE and initial TIL) and Closing Disclosure (which replaces the HUD-1 and final TIL) forms were found to allow for a 75% improvement in a consumer identifying the loan amount and identifying the total cash required to close a loan; a 29% improvement in overall consumer understanding; a 197% improvement in identifying the highest possible total monthly payment in the final loan offer; and a 47%improvement in understanding monthly principal and interest payment changes. That is quite a significant improvement.

The new disclosure forms apply to most consumer mortgage transactions, except home equity lines of credit; reverse mortgages; mortgages secured by a mobile home or dwelling not attached to real estate; no-interest 2nd mortgages made for down payment assistance, energy assistance or foreclosure avoidance; loans made by a creditor that makes 5 or fewer mortgages in a year and commercial mortgages.

In addition to the fact that we will be no longer be using the HUD-1 closing statement for any transactions on which a lender received a mortgage application on/after August 1, 2015, there will be a more collaborative effort between all parties involved (realtor, lender, title company) in a transaction relative to early reporting of all of the fees for that transaction in order to complete the final Closing Disclosure form well in advance of closing. Many lenders have already stated that they will be sending out the Closing Disclosure to their borrowers six days ahead of closing in order to meet the required 3-day Closing Disclosure rule. A borrower must receive the Closing Disclosure at least 3 business days prior to consummation of the transaction. If it is delivered in person, it is considered delivered on that day. If it is placed in the US mail, it is assumed to be received by the consumer three days after it is placed in the mail. If it is e-mailed or overnight mailed, it is assumed to be received by the consumer three days after mailed/e-mailed unless provided with confirmed receipt/rebuttal evidence. For e-mail, you also need consumer approval to use e-mail as the method of delivery. In limited circumstances, a change between the date the Closing Disclosure is given to the Borrower and the closing/consummation of the transaction will mandate a new Closing Disclosure and additional 3-day waiting period.

This is merely a brief overview of the changes. CSS has been educating realtors and lenders on the changes since the changes were first proposed in 2012 and we are ready to implement the changes come August 1st. If you have any questions, feel free to contact your CSS closing agent or myself.

 

Legal News and Case Law:

New statute will increase tax certification on deeds.

Public Act 39 of 2015 was just signed into law by the Governor. This Act increases the minimum fee charged by county treasurers for the five-year Tax Certification required to record warranty deeds and land contracts. This Act amends Public Act 161 of 1895, which requires county treasurers to furnish transcripts and abstracts of records and sets the fees to be paid for them and does the following:

  • Establishes a maximum charge of 25 cents per parcel record, not to exceed $1,500, for each request for an electronic copy of records in a qualified data file maintained by a county treasurer.
  • Deletes a requirement that a county treasurer collect a fee of 25 cents for each description of land on a requested list of State tax lands or State bids.
  • Increases from $1 to $5 the minimum fee a county treasurer must collect for descriptions of land contained in tax certificates filed with the register of deeds, effective July 1st. Please be aware of this increase so that recording fees may be accurately disclosed to buyers and/or sellers.
Corporate Settlement Solutions has many Michigan branch offices to serve you—Traverse City, Suttons Bay, Elk Rapids, Charlevoix, Bellaire, Mt. Pleasant, and Big Rapids in addition to providing services throughout the eastern United States.

Maura A. Snabes, Esq., CES®, CLTP – Sr. Underwriting & Compliance Counsel

Phone: (231) 547-5220×102/802 Bridge St., Charlevoix, MI 49720

e-mail: msnabes@visitcss..com.

This Newsletter may be construed as an advertisement as defined in Public Law 108-187. A recipient of this Newsletter may decline to receive future messages by making such a request to the above e-mailed address.


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