Posted by Kay/IL on 3/5/10 11:44am
Msg #325479

Loan Officers and Lenders, Please Help Us!

I'm sure that many fellow notaries have come across this problem.

You receive and review the documents. The HUD states that the borrower needs to bring X dollars to the closing table. You put in a courtesy call to the borrower to inform them. However, they were told that they did not have to bring any money for closing because their loan officer or lender told them there were "no closing costs to pay."

Loan officers and lenders-please clarify this "no closing costs to pay" with the borrower prior to my going to the closing. Better yet, please discuss the HUD with the borrower prior to closing so they will understand how you arrived at your figures in case they have to bring money to the closing. Define terms and any other mortgage/banking jargon so they will understand what they are signing. Although I understand what the HUD is saying, I did not insert and crunch the numbers. Some borrowers think I prepared the documents!

Be helpful to the only person (the notary) the borrower may be seeing face-to-face concerning their refinance.

I'm off my soapbox now! But thanks in advance for your attention to this matter.

Reply by Charles_Ca on 3/5/10 12:09pm
Msg #325481

Just for information and not justification for thos LOis who are not aware of what is going on. there may be no closing costs for tthe loan itself, that deos nto mean escrow costs, documentation taxes and a bunc of other costs having onthing to do with the actual loan portion of the transaction aren't going to be assessed. The new requirements of having the settlement statement sent to the borrower in advance should help some of this. however I have noticed a disturbing trend of requiring the borroqer to back-date the settlement statement from some lenders, I personally think that is unethical and the borrower should not back-date any documents but that is not my business. I certainly don't let my clients backdate anything coming from my office, to me that is fraud under any definition: just because it doesn't affect the outcome of the loan doesn't mean its not a fraud in the absolute definition of the word.

Reply by mwm143 on 3/5/10 12:13pm
Msg #325484

Too bad LOs and Lenders won't read your post. n/m

Reply by Richard Goodwin on 3/5/10 1:17pm
Msg #325500

Spell check?

Reply by Charles_Ca on 3/5/10 2:07pm
Msg #325533

Spell check, whazzat?

wh

Reply by Charles_Ca on 3/5/10 2:07pm
Msg #325534

Spell check, whazzat?

wh

Reply by Charles_Ca on 3/5/10 2:07pm
Msg #325535

Spell check, whazzat?

wh

Reply by Charles_Ca on 3/5/10 2:09pm
Msg #325536

I have no idea what happened, sorry for the multiple posts! n/m

Reply by jba/fl on 3/5/10 2:16pm
Msg #325542

We all know what happened: you hit the enter key three times

Got impatient when the system slowed.....at least that's what happens when I do it.

Reply by Charles_Ca on 3/5/10 2:22pm
Msg #325545

Could be Juls, I was distracted at the time....

of course that is SOP with me, too many things, too little time!

Reply by jba/fl on 3/5/10 2:23pm
Msg #325547

Happy to see you found time to pop in here.... n/m

Reply by Linda_H/FL on 3/5/10 2:26pm
Msg #325548

I blame it on the cat walking on the keyboard...:) n/m

Reply by jba/fl on 3/5/10 2:27pm
Msg #325549

Re: I blame it on the cat walking on the keyboard...:)

That would just give you more characters - we have a few here!

Reply by Charles_Ca on 3/5/10 2:28pm
Msg #325550

:) :) to both of you, TTFN n/m

Reply by Charles_Ca on 3/5/10 2:38pm
Msg #325552

BTW Richard, that was pretty bad even coming from me...

I'm the world's worst typist and when I'm in a hurry it devolves rather fast. Needing new glasses doesn't help any; both of which are really lame excuses.

Reply by MW/VA on 3/5/10 3:35pm
Msg #325565

Have you considered the Dragon voice-activated system? It's

pretty cool!

Reply by MW/VA on 3/5/10 3:36pm
Msg #325566

I hear you. Especially when it's a VA or FHA streamline refi--supposed to have no out-of-pocket costs.
I don't know how they get away with it.

Reply by Teresa/FL on 3/5/10 5:50pm
Msg #325584

My understanding of these streamlined loans is that the cash due from the borrower is intended to cover the mortgage payment that is being skipped.

For example, a loan closing on 2/22/10 and funding on 2/26/10 would not have the first payment due until 04/01/10. The cash from the borrower would take the place of the payment that would have been due on 03/01/10. Sometimes there are additional funds due to cover the new escrow account for taxes and insurance too.

All the streamlined loans I have seen have had very low lender fees and the reduction in the interest rate, and the corresponding reduction in the borrower's monthly payment, has been enough to make it a good deal for them. The streamlined loans I have signed have resulted in happy borrowers.