Posted by jnew on 10/11/11 3:57pm
Msg #400170

Minimum Borrower Paper Docs at Signing

I have always operated under the rule that the borrowers sign at least one copy of the RTC for the lender and two copies each for their use in case they want to cancel. In addition they had to sign at least one TIL for the lender and sign one copy to keep, although they would not need it to cancel. I have seen new discussions where the SA has requested if the borrowers would like copies on a CD which they would either deliver to the closing or send it afterward. Is this an acceptable practice? If the procedure has changed or if the signing and paper copy requirement does not exist, I would like to know about it.

Reply by GOLDGIRL/CA on 10/11/11 4:20pm
Msg #400173

As to what is "acceptable practice" - that's between you and the hiring agency - but if you use a CD, I strongly suggest you also print out on paper the RTCs they keep (in case they cancel), as well as the major financial docs: note, settlement statement, IAF, any impound info for taxes and insurance, first payment letter and TIL.

Speaking of the "paper copy requirement," I have serached endlessly throughout RESPA to find exactly what it says about this and could never find any reference at all requiring that the borrower receive a copy of the docs in any form. Has anyone ever actually read this? Perhaps it's not contained in RESPA, but in title laws somewhere? Perhaps it's not even a law or regulation...?

I also never have the borrower sign their copies of the RTCs - I know this has been debated here before - and I certainly have never had them sign a copy of the TIL to keep (?)

Reply by jnew on 10/11/11 5:02pm
Msg #400179

I started doing closings for mortgage companies in 1982 and at the time that was the rule. You gave the borrower two signed copies each of the RTC and one copy each of the TIL. In all the time since I was never given a reason about the TIL.

Reply by ReneeK_MI on 10/11/11 7:05pm
Msg #400191

See Reg Z/TILA - not RESPA =) n/m

Reply by CinOH on 10/11/11 4:20pm
Msg #400175

I always provide borrowers w/ paper copies. Burning a CD would be easier but everyone does not have a computer. Also, if he CD becomes corrupted (easy to happen) the copies are lost. Having borrowers sign RTC or TIL is not a rule, it's a practices that some follow and some do not.

Reply by Scriba/NM on 10/12/11 2:18am
Msg #400216

For what it's worth, I have two title companies that specifically forbid the use of e-mailing copies or providing CD's in place of paper copies. They want the borrower to have a complete copy of the loan documents (without all of the inane instructions they place in the package). They specifically state that you must remove those instructions from the borrower package. Some dumb notaries have been leaving page after page of notary instructions in the borrower package. Duhhhhhh. This is how stupid this business is getting.

You should always have the borrowers sign their copies of the RTC - a notary friend of mine lost a very lucrative line of assignments because he didn't have the borrowers sign the receipt portion. The borrowers cancelled and signed the I Wish To Cancel section, but a legal situation developed because they sent in the form with no signature(s) on the bottom acknowledging date of receipt. I know notaries get in a hurry, but you need to perform the signing correctly, quit taking shortcuts and do the job you are getting paid to do. If you don't want to do it correctly, then you need to apply at McDonalds, Starbucks or Einstein's. I also hear that Hot Dog On a Stick is participating in local job fairs......Mmmmmmmm. Then again, someone would probably screw that up too. -30-

Reply by ReneeK_MI on 10/12/11 6:19am
Msg #400217

About that 'legal situation' - here is the actual law

While WE of course follow our client's directives, there is no legal requirement for the RTC form to be signed. There is no legal requirement for a consumer to use the lender-supplied RTC form to rescind. For a lender to refuse a consumer's request to rescind due to that request not having been signed in the "I acknowledge receipt of two copies" part of the widely-used version of the form would be a violation of Federal law. (Sounds to me like an angry client told a notary a bit of a scare-story for added effect.)

Having witnessed many compliance inspections by the FDIC relative to the proper disclosures of the TIL and the RTC - this was done by examination of software data (showing the data in the forms, the format of the forms, and the tracking - uploaded, downloaded, printed; when & by whom - and not of physical/signed documents. Despite the nearly industry-wide SOP of having these forms signed, not even the FDIC wants to go the 'easy' (or logical?) route of just looking at a signed form. Perhaps, since they do not require the form to be signed in the first place, that's just not what they inspect.

For the FDIC's rules regarding rescission, go to the FDIC's "Truth In Lending Act" of Regulation Z:
http://www.fdic.gov/regulations/laws/rules/6500-1400.html - scroll to Subpart C, select Right of Rescission.

There will also be a reference to Appendix H-8 (showing the model form), which I have excerpted here:


H–8—RESCISSION MODEL FORM (GENERAL)

"How To Cancel

If you decide to cancel this new transaction, you may do so by notifying us in writing, at

(Creditor's name and business address).

You may use any written statement that is signed and dated by you and states your intention to cancel, or you may use this notice by dating and signing below. Keep one copy of this notice because it contains important information about your rights.

If you cancel by mail or telegram, you must send the notice no later than midnight of _______ (Date) _______

(or midnight of the third business day following the latest of the three events listed above).

If you send or deliver your written notice to cancel some other way, it must be delivered to the above address no later than that time.

I WISH TO CANCEL

Consumer's Signature

Date

Reply by ReneeK_MI on 10/12/11 6:27am
Msg #400218

Specific to your question ...

We as NSA's need to adhere to the requirements of whomever hires us - and (hopefully) those requirements adhere to Federal laws. The TILA does allow for the LENDER to provide digital/electronic copies (and in that instance, only 1 of each form is required) - but still, this is the LENDER'S perogative and does require the consumer's expressed consent to receive their copies digitally/electronically.

Those who are making choices for/on behalf of the LENDER might want to re-think that protocol. Violations of Federal law are really, really not a good thing and Lender's spend a lot of good money making certain their protocols are tight. THEY make their own choices, WE follow their directives. <--period.