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Maureen
New Hampshire
9 Posts |
 Posted - 11/20/2007 : 01:47:06 AM
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This sounds like a Ditech and they never have a HUD, always an estimated HUD. The borrower signs a paper saying that this has been disclosed to them and that they waive the final HUD at signing.
Some lender do give an RTC for 2nd homes but it is only mandatory for principal residences as pointed out. |
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LindaH
Florida
1754 Posts |
Posted - 11/17/2007 : 1:05:10 PM
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quote:
Originally posted by lkassis
In the event that an RTC period is applicable to a loan, the borrower is NOT required to use the Notice of Right to Cancel form to inform the lender of their wish to rescind the loan. The RTC form is a document required to be given to the borrower to inform them of their right to cancel if applicable in that situation.
As stated on the Notice of Right to Cancel form:
If you decide to cancel this transaction, you may do so by notifying us in writing at: [address of lender]
You may use any written statement that is signed and dated by you and states your intention to cancel and/or you may use this notice by dating and signing below. If you cancel by mail or telegram you must send the notice no later than midnight of [end of rescission date] (or midnight of the third business day following the latest of 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.
Furthermore, according to the Real Estate Procedures Act (RESPA):
• It is the borrower’s right to request a copy of the HUD-1 Settlement Statement prior to time of actually signing of the loan package. If they asked for it and didn't receive it this might be considered a breach of the RESPA laws. This information within the laws can be found at HUD.gov searching RESPA
This borrower seemed to think they had a right to rescind based on your description of the happenings.
The above information was supplied as a resource only and is only my personal opinion. View the laws of RESPA and read an NRTC to derive your own interpretation. I am not an attorney.
Linda Kassis
United Notary Association (UNAA)
www.unitednotaries.org
www.halitek.com
If you are not riding the wave of change, you may find yourself under it. Ride the wave with the UNAA.
The point being that the borrower should not be calling the SA to cancel - and this should be made clear at the time of signing - the RTC, if applicable, explains how to exercise that right - and notifying the SA is not included in those instructions. The SA needs to be totally out of the loop.
Also, shame on the LO who let the borrower sign a non-rescindable loan under the belief that it WAS rescindable. Now the borrower is not happy, can't get any answers, and is stuck with a loan he doesn't want. THAT, IMO, is where your predatory lending comes in...
Linda
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lkassis
Iowa
60 Posts |
Posted - 11/17/2007 : 07:16:56 AM
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In the event that an RTC period is applicable to a loan, the borrower is NOT required to use the Notice of Right to Cancel form to inform the lender of their wish to rescind the loan. The RTC form is a document required to be given to the borrower to inform them of their right to cancel if applicable in that situation.
As stated on the Notice of Right to Cancel form:
If you decide to cancel this transaction, you may do so by notifying us in writing at: [address of lender]
You may use any written statement that is signed and dated by you and states your intention to cancel and/or you may use this notice by dating and signing below. If you cancel by mail or telegram you must send the notice no later than midnight of [end of rescission date] (or midnight of the third business day following the latest of 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.
Furthermore, according to the Real Estate Procedures Act (RESPA):
• It is the borrower’s right to request a copy of the HUD-1 Settlement Statement prior to time of actually signing of the loan package. If they asked for it and didn't receive it this might be considered a breach of the RESPA laws. This information within the laws can be found at HUD.gov searching RESPA
This borrower seemed to think they had a right to rescind based on your description of the happenings.
The above information was supplied as a resource only and is only my personal opinion. View the laws of RESPA and read an NRTC to derive your own interpretation. I am not an attorney.
Linda Kassis
United Notary Association (UNAA)
www.unitednotaries.org
www.halitek.com
If you are not riding the wave of change, you may find yourself under it. Ride the wave with the UNAA. |
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LindaH
Florida
1754 Posts |
Posted - 11/17/2007 : 04:00:57 AM
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I think my biggest question here is why was this loan signed without these questions being answered ahead of time - the LO should have known that there was no RTC, and the borrower should have been made aware of it - if it's investment property, which is what it sounds like, borrower should have known way back at the beginning that this didn't qualify as a rescindable loan. In addition, I think I've read where it's required that FL loans close with a final HUD since FL is not an escrow state (not sure where I read that and maybe those wiser will clarify this). However, I've had several packages that contained the estimated statement - very few but I have seen them.
My personal practice in these situations (and again, this is only MY way of doing it) is to show the borrower the HUD, the Note and then explain to them they have 3 days to review everything and back out of the loan - HOWEVER, if there's no RTC, I tell borrowers right up front that they do not have the three days to change their mind so any questions they have should be addressed immediately.
My last words to the borrowers before I leave is to remind them about the 3 day rescission period (if applicable) and remind them to follow the instructions on the RTC to cancel, call and follow up with their LO but DO NOT CALL ME - I let them know once the package is dropped (which is usually right after closing) my part in the transaction is finished and I have no authority to accept their rescission or cancel the loan for them.
It's too bad you were put in this predicament - unfortunately, if this WAS investment property, the poor guy is probably stuck with the loan - and that's something he needs to take up with the LO and lender and anyone else who failed to fully advise him about the particulars of his loan. You DO need to stress to him that you can't help him and get yourself out of the loop. JMHO
Good luck to you..
Linda
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Edited by - LindaH on 11/17/2007 04:02:46 AM |
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Renee
Michigan
549 Posts |
Posted - 11/16/2007 : 8:36:49 PM
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You said the B was from NJ, and the subject property was in FL - most likely the property is not his primary residence, so there is no RTC.
In CA, signings are generally done with Estimated Closing Statements, just as the SS explained - CA closes 'in escrow', and the final Hud is presented when the file is completed,and funds are disbursed.
When the B was told that "loans fund in 24 hours in FL" - most likely he was told that HIS loan would fund in 24 hours, as it was most likely NOT his primary residence and, again, did not have a RTC. |
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n/a
Colorado
2 Posts |
Posted - 11/16/2007 : 2:36:55 PM
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Hello, I need help with a situation that has taken place.
I was called by a SS in CA to go to a signing for a borrower from NJ, that was visiting here in CO and the property is actually in FL. Signing was a refinance. Received documents. Signing was set for 11:30 pm. Borrower happened to call me 'cause meeting was running late. While in conversation, it was mentioned to me that the LO had called borrower and the question came up about the figures on the HUD. The LO stammered and told the borrower that the Notary would have the HUD. I was asked about the HUD and why would an LO not have those figures? Did not know the answer to that but said I would call the SS, which I did. The SS said the HUD was in the package. I replied not so. I went thru package, no HUD. According to SS, what was present was the "Estimated Closing Statement." It was stated that the "Estimate" was the HUD form for CA. Also not in the packet was an RTC. Confusion ensued and I did not notice about the RTC.
Two days later, received a phone call from the borrower. Borrower want to rescind due to bad communication with LO and the SS. Not satisfied with the figures in loan, many questions, can't get straight answers. Borrower wants to know how to cancel loan. Then I checked and there was no RTC. Now I am somewhat perplexed, disturbed and shaken. No HUD; No RTC; No communication; Borrower was told that loans fund in 24 Hours in FLA. Borrower angry. And the only time that I know that a HUD or RTC does not appear is in a purchase transaction.
Borrower wanted to know what to do. Tonight at midnight would be the end of recission if ability exists, but no RTC to make it available. Before I have a heart attack, can anyone share any thoughts on this?
Thanks. |
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