Posted by NVLSlady/VA on 11/30/13 7:59am
Msg #494454
Explanation vs. UPL
Here, I was thinking the problem was in the "regional" differences in interpretation/comprehension, but love how LKT/CA broke this down (msg 494368):
<"Great dialogue on this subject. I agree that it's the LO's job to ensure that their client understands the loan, since we are presenting the finished product and have no part of the process. I also agree NSAs are more than "just the notary" at a loan signing, yet in facilitating the loan, we're to simply point out the printed facts. But in pointing out those printed facts, borrowers have different education levels. Some understand a college level description...some understand a 10th grade level description...others a 6th grade description and yet others understand a 3rd grade level description. Herein lies the explanation of "ensuring that the borrower understands.">
p.s. Word trippin' is how cheaters/liars became extra-marital "affair" devotees
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Reply by CJ on 11/30/13 10:03am
Msg #494471
It is a bit of a tightrope walk.
MY understanding is this: We can't give "advice" or "opinions". which is fine, but, as far as I can tell, no one said we can't state FACTS, according to the black and white of the printed words. I never tell them what anything MEANS, but I do make them read it. I do point-point-point on the Note, and I read aloud the hud to them while pointing. I always make them read the change of vesting on the Grant Deed, so they KNOW how the vesting is changing, even if they are just adding a middle initial. I also point-point-point the til.
If I see something that is unusual, I make them read it out-loud and explain it to me. I say, "Is that what they told you?" If they say, "Yes, that's exactly what we discussed", then fine; they obviously understand it and they are comfortable with it.
If it's something that really looks shifty to me (and I have not seen anything shifty since Pick-a-payment days), and after reading it for themselves, they say, "I don't understand. This doesn't make sense. How will this affect me? Should I sign it?" I say, "It is illegal for me to give advice or opinions, so let's call someone." We usually try to get their rep on the phone, but if we can't, I say, "Let's call someone you trust" (dad, lawyer, accountant-relative, etc.) Sometimes I sign elderly people, and they have their adult children there. I tell the adult children, "I'm GLAD that you are here, because it is illegal for me to give advice or opinions, and I want someone looking out for your parent". Of course, usually everything is just fine.
I remember one time the rep was there, and I was point-point-pointing the note, and I said, "And here is your interest rate". It was 8. (This was a LONG time ago.) The borrower said, "It's supposed to be 4". The rep said, "It really IS 4!" I thought, "OMG! The rep just LIED to him!" But I knew I was forbidden to SAY anything. They started arguing in Spanish and they argued for for 45 minutes. I thought, "I'm glad I don't speak Spanish, because I don't want to be held accountable for anything this lying rep says." I just sat there quietly, but I could tell by the body language that the rep was losing. He was getting redder and redder, and leaning across the table and shaking his finger and getting pretty worked up. Finally the rep's phone rang so he excused himself and walked out. I said to the borrower, "I don't know what he told you, but this is what the note says" and I pointed to the 8 again. The borrower said, "I'm not signing." I grabbed my stuff and left before the rep could get off the phone.
When I signed pick-a-payment people, we would read the details together, how they had a three year ppp and how the neg-am payment was going to go up from $800 to $2500 in three years. They ALL understood it and they ALL happily signed it. (And they ALL voluntarily explained to me that they maxed out their credit cards at 20% on trucks, boats, vacations, electronics and remodeling, and had "no choice" but to roll it into their loan.) No one one my watch can say the bank tricked them.
(Okay, let the feeding frenzy begin.)
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Reply by MikeC/TX on 11/30/13 5:48pm
Msg #494532
The standard test for UPL, according to the ABA, is whether you are applying the law to the facts of a particular situation.
You can certainly explain the purpose of a document in general terms - that just tells them what the document is for, and it's considered general knowledge. But if you then go on to tell them what it means in THEIR case , or answer them when they ask "What happens if I sign this?", or discuss the numbers with them, you've probably crossed the line into UPL.
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