Know Before You Owe: Closer to Closing — Testing, Testing ….

The Consumer Finance Protection Bureau has begun testing two new forms to replace the current HUD-1 and Final TIL, which integrate the existing forms into one consumer user friendly form.

The Bureau is seeing feedback on which of the two designs works best.  To see examples go to:  http://www.consumerfinance.gov/knowbeforeyouowe/  and share your thoughts.

Unlike previous changes that have impacted mortgage brokers and bankers, the Bureau is seeking input on the forms, the process and how functionality of disclosures.  The new forms are being tested in Birmingham Alabama.  To have your say go to:

http://www.consumerfinance.gov/knowbeforeyouowe/

• Which design works best? Why?
• Is the information presented in a consumer-friendly format?
• Could consumers easily identify key loan terms and closing costs?
• Does the disclosure cover all the important information you need?
• Is the document easy for lenders and settlement agents to use?

2012 USDA Refinance Fees

EFFECTIVE Wednesday, December 7, 2011: The upfront guarantee fee for all refinance transactions increased from 1 percent to 1.5 percent at this time.
Conditional Commitments for refinance transactions that have previously been issued by USDA “subject to the receipt of commitment authority” at the 1 percent upfront guarantee fee structure will be honored by the Agency once the commitment authority becomes available.
Effective Wednesday, December 7, 2011, new Conditional Commitment requests for a refinance transaction will be issued by the Agency utilizing a 1.5 percent upfront guarantee fee and a 0.3 percent annual fee. The new fee structure for FY12 is as follows:
•2 percent upfront guarantee fee for purchase transactions;
•1.5 percent upfront guarantee fee for refinance transactions; and
•0.3 percent annual fee for both purchase and refinance transactions.

Columbus Day

Monday, October 10^th is Columbus Day, a federal holiday.  Stonegate Mortgage Corporation offices will be open, however bond market and most if not all banks are closed for the day. 

 As such there will be no funding of loans Monday October 10^th, and the lock desk will not be open.

Most importantly, as a federal holiday, Monday October 10^th cannot be counted as a rescission day for refinance loan closing purposes. 

Lock expirations falling on a weekend or holiday “roll” to the next business day, however we remind you to check your expiration dates to account for the non-rescission day and shorter week in your loan funding schedules.

USDA Rural Housing Availability of Funds

Stonegate Mortgage has received word from USDA that funds for USDA refinance transactions are not available, at this time.  USDA refinances may be originated, processed, underwritten and submitted to USDA for a conditional commitment.  However, these loans may not close until funds are available again.

USDA’s fiscal year ended September 30, 2011.  The word from USDA is that funds should be available the latter part of October.  We hope this is a short lived issue.  When we get word that funds are available again, we will begin closing refinance transactions.

Purchase transactions are still able to close, as there is no shortage of funds for purchases.

Mortgage Market Update

Good morning,

We are seeing unprecedented trading in the MBS markets this morning and traders as well as Tier One lenders have been struggling to come up with prices to convert to mortgage rates-we will have pricing posted as soon as possible however the lock desk may be delayed slightly from the 11am ET start time to allow some consensus to be built in the markets.

MBS is trading up 24 ticks after the huge run up late yesterday so expect some improvement once pricing is established.

 

Thank you,

Mike Brown

Capital Markets