Posted by HisHughness on 2/21/05 4:06pm
Msg #21682

Insight, please

I need some instruction.

Problem 1: Adjustable rate note. The TIL recites the following payment schedule, and the duration of each level of payment:

12 $763.73
4 762.80
8 803.44
12 802.53
12 801.58
12 800.57
12 799.52
12 798.41
12 797.25
12 796.03
12 794.74
4 793.39
235 747.52
1 749.84

This makes no sense to me. The HUD says no mortgage insurance being charged. Can someone explain what is going on?

Problem 2: The note recites an initial interest rate of 4.5 percent, for a dollar amount of $706.88. Why the difference between the note and the TIL?

Reply by Bob-Chicago on 2/21/05 4:28pm
Msg #21683

If you look through the entire pkg , you should find tha there (sic) is in fact mtg ins
It drops a bit each year as their (sic) principle bal declines
When it is on the hud, it is an up-front fee
It might also be showing estimated future pmts on an adjustable mtg, but the $s don't seem correct for that.
Der , der (Chicago style), now do you feel better?

Reply by HisHughness on 2/21/05 4:33pm
Msg #21686

Thanks, but that doesn't explain the difference between the initial payment figures on the note and on the TIL, nor does it explain the 12-4-8-12-12-12-12-12-12-12-12-4-235 pattern of changes in the monthly payment.

Reply by Bob-Chicago on 2/21/05 5:04pm
Msg #21699

Confusing

insurance is 56.84 for year one and 55.92 for next four months?
I have never heard of a 16 month arm
Looks like rate increases after 16 months and then ins drops each year for 10 yrs and 4 months after which no PMI.
I once had a signing, with PMI. Last signing of a long day. I innocnetly said "this doc explains your PMS (sic), I said "oops, sorry", but she reported me anyway. She must have been for a Red State originally.
Better explanation, is that someone may have screwed up the TIL
Maybe the bwrs will be Aggies and won't be clever enough to see that there may be a problem
Make a clever comment about the great state of Texas when you present the TIL, and try to distract them. As an attorney , you must know the techinque of "dazzaling them with your
B#@l S&*t
Good luck

Reply by Dennis D Broadbooks on 2/21/05 5:15pm
Msg #21703

Being from a "Red State"...

...is no guarantee you're smearing the intended political persuasion with your subtle remark. There're more than a few discouraged Dems still walking around in a daze in Missouri...grousing about the results of the election & looking as if they're in the midst of PMS.

Reply by ERNA_CA on 2/21/05 4:32pm
Msg #21684

Scary stuff. I just received a loan package via Fed EX. soppin wet, To days date is 2/21. Documents have the date of 2/16 but all the disclosures are dated 3/3 2005.
I wount even attempt to comment on the difference between the note and the TIL.

Reply by Alabama on 2/21/05 4:32pm
Msg #21685

What mortgage co or lender is this going through? I had a weird one like this and it was based on a good pay record. Does it not explain itself on the note or a rider to the note or mortgage? The answer should be interesting. Call the lender and let us all know!

Reply by Joan-OH on 2/21/05 4:55pm
Msg #21694

Strictly a guess here.

Looks like an FHA/VA with MIP and the first adjustable date is not the 1 year or 2 years that we are used to seeing, but on the same date as everyone who has a mortgage with that bank - In this case it looks like that date is 4 months from now, but they are giving them at least a year fixed. The 16th month shows the worst rate increase scenario it can be on that date, but they don't go so far as to predict anything else beyond that first change date and use that first rate change date for the life of the loan. It does not mean that will be their rate, just a worst case scenario.

So the first 12 payments would show the initial interest rate, but then the MIP would go down after a year as it will every year until it falls off at the 235th payment. But the initial interest is fixed until xxxx month. They still have to show the MIP going down every 12 months until it falls off at the 235th payment.

By the way, I absolutely would not say this to the borrower, especially on an adjustable note! The furthest I would go is to point out the fixed period because really, anything after that is a prediction I'm not willing to make and either is the bank - that is why they only use the first rate change scenario to begin with and even that is a guess. If it is indeed an FHA/VA I might indicate that the monthly MIP is predicted to go down every year, but I'm not sure I would say that much.

As I said, I might somewhat understand it, but not my place to explain it other than to say "it's due to the ARM and MIP - ask your loan officer." Really, I've never had anyone that paid much attention to it.

I may be wrong, but that is really the only time I've seen such a scenario on a TIL.

Joan-OH

Reply by HisHughness on 2/21/05 4:59pm
Msg #21695

Thanks, Joan. That makes some sense, though I'm still puzzled why the HUD doesn't reflect any MIP. And the TIL does not indicate the subsequent monthly payment quotes are estimates.

If asked, I'll just respond, "How 'bout them Patriots!"

Reply by Joan-OH on 2/21/05 5:04pm
Msg #21698

Is their MIP on the escrow disclosure? I'm not quite sure how FHA/VA premiums are charged, but maybe if it's a streamline or rewrite, that initial premium doesn't have to be recollected? Usually on these, I see a new premium and refund of the old premium on the HUD.

Hey, maybe the title company forgot it! Now we all know THAT wouldn't happen! :-)

Joan

Reply by PAW_Fl on 2/21/05 6:42pm
Msg #21709

Why would you expect to see PMI on the HUD? It's not a closing or settlement cost. Just like you don't see the escrow additions. (Granted you do see the initial deposit to the escrow account.) There should be a couple of docs that show the PMI, how it's calculated, when it expires showing the date for an 80% and a 78% LTV. There may also be a first payment letter showing the P&I, escrow for taxes, escrow for HI (or HOI) and escrow for PMI.

Reply by PAW_Fl on 2/21/05 7:03pm
Msg #21711

Not PMI, just MI ...

FHA insured mortgages don't have private mortgage insurance (PMI). Instead, FHA mortgages carry mutual mortgage insurance (MMI). The MMI premium is frequently paid through both an upfront mortgage insurance premium (MIP) and a monthly mortgage insurance (MI) premium. The MI may be reduced as the LTV decreases. This may explain the differences in the payment amounts shown on the TIL.

Reply by BrendaTX on 2/21/05 9:03pm
Msg #21728

MIP: Minor in Possession

No more minor children, so...

"MIP" no longer keeps me up at night. After those thrilling years with my boys...MIP on a HUD has certainly lost it's sting.

Reply by BrendaTX on 2/21/05 9:10pm
Msg #21729

btw...

Minor in Possession of **Alcohol**...I looked at that and thought "Possession???"

Yikes!

Wanted to clarify.

Reply by Ernest_CT on 2/21/05 9:14pm
Msg #21730

Speaking of possession, ...

... if you don't pay the exorcist's bill do you get repossessed?

Reply by BrendaTX on 2/22/05 2:33pm
Msg #21821

Re: Speaking of possession, ...

E-CT said: "... if you don't pay the exorcist's bill do you get repossessed?"

Not sure. I maintain a very good credit line with my exorcist. However, you bring up a very good point.

Reply by HisHughness on 2/21/05 7:03pm
Msg #21712

I dunno, Paul. Probably the only reason I would expect to see PMI on the HUD would be because of "Line 902 Mortgage Insurance Premium for ___________ months to ________" and "Line 1002 Mortgage Insurance ________ month @ $_________ per month."

Reply by PAW_Fl on 2/21/05 7:18pm
Msg #21714

Line 902 would only show the MIP if it were to be paid at settlement as a closing cost. If it is paid over the course of the loan, or by the lender as part of the principal, it wouldn't necessarily appear as a closing cost.

Line 1002 is the intial depost into the escrow account for mortgage insurance. Again, if the MI is being paid by the lender out of the principal of the loan, it wouldn't appear here.

Reply by CA-Notary on 2/21/05 8:36pm
Msg #21725

What's the big deal; we are not suppose to be reading the docs

Reply by Alabama on 2/22/05 10:28am
Msg #21783

Re: So do we really know?

If the borrower has questions about this they would call the mortgage broker or lender. Once again, His Hughness...did you try that so we might have a definite answer?