Presentation is loading. Please wait.

Presentation is loading. Please wait.

Purchasing Hints and Tips What You Need To Know To Get a Closing Package Purchased on the First Try.

Similar presentations


Presentation on theme: "Purchasing Hints and Tips What You Need To Know To Get a Closing Package Purchased on the First Try."— Presentation transcript:

1 Purchasing Hints and Tips What You Need To Know To Get a Closing Package Purchased on the First Try

2 Preparing the Closing Package Our bank name should always appear as Merchants Bank, National Association.Our bank name should always appear as Merchants Bank, National Association. Every closing package should include the Closed Loan File Stacking Order Checklist, all UW At Close conditions, and all required closing documents.Every closing package should include the Closed Loan File Stacking Order Checklist, all UW At Close conditions, and all required closing documents. The original note and allonge should be mailed to 62 W 3 rd St Winona, MN The remainder of the closing package is uploaded electronically to the Calyx Path file. Purchasing can be contacted with questions via at com, option #2, or internal extension com

3 Miscellaneous Items to Remember Please complete the Appraisal screen in Calyx Path including the individual appraiser information.Please complete the Appraisal screen in Calyx Path including the individual appraiser information. The file in Calyx Path must contain a rate lock agreement signed and dated by the borrower and lender showing the interest rate has been locked. This must be dated on or after the date of the initial application.The file in Calyx Path must contain a rate lock agreement signed and dated by the borrower and lender showing the interest rate has been locked. This must be dated on or after the date of the initial application. The file in Calyx Path must contain an initial application that is signed and dated by the lender.The file in Calyx Path must contain an initial application that is signed and dated by the lender. All loan terms must match between DU or LP, the rate lock, and the closing documents.All loan terms must match between DU or LP, the rate lock, and the closing documents.

4 Underwriting At Close Conditions All necessary documentation to satisfy the UW At Close conditions must be included in the closing package.All necessary documentation to satisfy the UW At Close conditions must be included in the closing package. Please contact the UW Department PRIOR to loan closing if there are any questions or concerns regarding the conditions. This is especially important if the cash to / from borrower is not going to meet the condition.Please contact the UW Department PRIOR to loan closing if there are any questions or concerns regarding the conditions. This is especially important if the cash to / from borrower is not going to meet the condition.

5 Subject Property Address Review the submitted DU address and the standardized DU address for discrepancies!Review the submitted DU address and the standardized DU address for discrepancies! –If there are no discrepancies, the loan documents should match both addresses. –If the submitted and standardized addresses do not match, the first page of the appraisal must match the standardized address and there must be an addendum to the appraisal showing the submitted address and language stating the two addresses are one in the same. The LPS flood certificate must show a determination address that matches the standardized address.The LPS flood certificate must show a determination address that matches the standardized address. The hazard insurance must match the submitted address.The hazard insurance must match the submitted address. The note, mortgage, and all remaining closing documents must match the submitted address.The note, mortgage, and all remaining closing documents must match the submitted address.

6 SSA-89 / SSA-3288 The SSA-89 is required for all borrowers and must be included in every closing package.The SSA-89 is required for all borrowers and must be included in every closing package. A fully completed sample of this form is available in Chapter 8 of the manual.A fully completed sample of this form is available in Chapter 8 of the manual. NO alterations may be made to the form even with the borrower’s initials (cross offs, write overs, etc.).NO alterations may be made to the form even with the borrower’s initials (cross offs, write overs, etc.). The SSA-89 may not be signed by a POA.The SSA-89 may not be signed by a POA. The SSA-3288 is required for every borrower that qualifies using Social Security income (SSI). A fully completed sample of this form is available in Chapter 8 of the manual. NO alterations may be made to the form even with the borrower’s initials (cross offs, write overs, etc.). The SSA-3288 may not be signed by a POA.

7 Right of Rescission The Right of Rescission may never be re- executed.The Right of Rescission may never be re- executed. We do not require the borrower to sign after the 3 day period has ended.We do not require the borrower to sign after the 3 day period has ended. Any changes/alterations made to the document MUST be initialed by the borrower.Any changes/alterations made to the document MUST be initialed by the borrower.

8 Power of Attorney When a Power of Attorney is used by one or both borrowers to sign the closing documents we will require the following:When a Power of Attorney is used by one or both borrowers to sign the closing documents we will require the following: –A fully completed and executed POA form. A signed certified copy may be provided in the closing package however a recorded copy is required to be included with your trailing documents. –The signature lines must be typed and signed per one of the options outlined in the investor guidelines. Best Practice : John Doe by Jane Doe as POA When a Power of Attorney is used by one or both sellers for a purchase transaction we will require the following: –A fully completed and executed POA form. –If the POA is used only for the HUD a copy is sufficient. –If the POA is used to sign the warranty deed a recorded copy will be required for our Trailing Documents Department. –A POA is NOT required if the property is being sold by a company or institution.

9 Application The Purchasing Department will review the final application for the items shown below, however for compliance reasons the application must be completed in it’s entirety.The Purchasing Department will review the final application for the items shown below, however for compliance reasons the application must be completed in it’s entirety. - Date of Birth, Home Phone Number, Marital Status - First Time Homebuyer information must be consistent between sections III and VIII. - Signed by the borrower and dated with the closing date. - Signed by the Loan Originator and dated with the closing date. - Loan Originator Identifier and Loan Originator Company Identifier fields must both be completed. - Government Monitoring must have the race, sex, and ethnicity completed if application was taken face-to-face.

10 Note The payment address should be that of your bank’s location.The payment address should be that of your bank’s location. The late fee section must reflect 5% charge after 15 days.The late fee section must reflect 5% charge after 15 days. Borrower’s name must be typed exactly the same between the note, all 3 locations on the mortgage, and the assignment of mortgage.Borrower’s name must be typed exactly the same between the note, all 3 locations on the mortgage, and the assignment of mortgage. Fannie Mae loans have a P&I tolerance of.01 less than the DU findings or up to $1.00 over the DU findings.Fannie Mae loans have a P&I tolerance of.01 less than the DU findings or up to $1.00 over the DU findings. Freddie Mac loans have a $0 tolerance for the P&I.*Freddie Mac loans have a $0 tolerance for the P&I.* *For UW Approval P&I see Loan Transmittal (1008)

11 FKA / AKA Language FKA / AKA Language The borrower’s name is one of the most common reasons a file is pended. Please follow the guidelines below in order to avoid having the file suspended.The borrower’s name is one of the most common reasons a file is pended. Please follow the guidelines below in order to avoid having the file suspended. –When FKA / AKA language is used it must be used on the signature lines of the note and mortgage, the preamble of the mortgage, notary section of the mortgage, and the assignment of mortgage. –If the borrower’s name is different than how it appears on title (completely different name; not just a variation) you must either use the FKA / AKA language or execute a Quit Claim Deed. You may execute a name affidavit if there is only a minor variation such as using a middle initial vs a full middle name.

12 Title Commitments The title commitment must have an effective date within 90 days of closing.The title commitment must have an effective date within 90 days of closing. The Proposed Insured must read either your bank name plus ISAOA language OR Merchants Bank National Association plus ISAOA language. Our bank name may not be abbreviated in any way.The Proposed Insured must read either your bank name plus ISAOA language OR Merchants Bank National Association plus ISAOA language. Our bank name may not be abbreviated in any way. A purchase transaction must include a copy of the warranty deed in the closing package with the title commitment.A purchase transaction must include a copy of the warranty deed in the closing package with the title commitment. Please include a copy of any documents referenced in the commitment such as driveway or well agreements, conditional use permits, easements, and encroachments. Please be pro- active and contact the UW or Purchasing Help Desks if you are questioning whether or not a document will be required for Purchasing or Trailing Docs.Please include a copy of any documents referenced in the commitment such as driveway or well agreements, conditional use permits, easements, and encroachments. Please be pro- active and contact the UW or Purchasing Help Desks if you are questioning whether or not a document will be required for Purchasing or Trailing Docs.

13 Mortgage Please include all pages of the mortgage and provide a signed certified copy. This means the mortgage must be stamped as certified and also signed by the person who is certifying the document.Please include all pages of the mortgage and provide a signed certified copy. This means the mortgage must be stamped as certified and also signed by the person who is certifying the document. The notary section must include the City, State, date of acknowledgement, and signature of the notary.The notary section must include the City, State, date of acknowledgement, and signature of the notary. The preamble must include the marital status (joint tenants is not sufficient).The preamble must include the marital status (joint tenants is not sufficient). Names must be typed consistently between the preamble, signature lines, and notary section.Names must be typed consistently between the preamble, signature lines, and notary section. Names must be typed exactly as they appear on the note.Names must be typed exactly as they appear on the note.

14 Mortgage Riders One or more of the riders listed may be required based on the DU findings, and these may not always be listed as UW At Close condition.One or more of the riders listed may be required based on the DU findings, and these may not always be listed as UW At Close condition. Please contact UW prior to close if you are questioning the need for a rider. Please contact UW prior to close if you are questioning the need for a rider. The mortgage must have the applicable box checked if any rider is attached.The mortgage must have the applicable box checked if any rider is attached. The borrower’s name must be typed below the signature line on all riders, and it must be typed as it appears on the mortgage.The borrower’s name must be typed below the signature line on all riders, and it must be typed as it appears on the mortgage. Second Home Investment Property (1-4 Family & Assignment of Rents) Primary Residence 2-4 Family (1-4 Family & Assignment of Rents) Condominium (Association name must be included) Planned Unit Development – PUD (Project name must be included) Adjustable Rate Mortgage - ARM

15 Modifications These must be completed on Fannie Mae form 3179 for a fixed rate and form 3161 for an ARM product.These must be completed on Fannie Mae form 3179 for a fixed rate and form 3161 for an ARM product. The original recorded mortgage must be included in the closing package, as well as any other modifications done prior to the final modification.The original recorded mortgage must be included in the closing package, as well as any other modifications done prior to the final modification. The modification must include the document number and date of the original mortgage.The modification must include the document number and date of the original mortgage. The borrower’s name must appear as it did on the original mortgage.The borrower’s name must appear as it did on the original mortgage. The modification must be signed by lender and include their typed name, title, and the date.The modification must be signed by lender and include their typed name, title, and the date.

16 Hazard Insurance Every closing package must contain a binder, policy, or declarations page for the subject property that includes the following criteria:Every closing package must contain a binder, policy, or declarations page for the subject property that includes the following criteria: –Mortgagee can appear as your bank name OR Merchants Bank with ISAOA language included. –The address of the subject property must exactly match how it appears on the note (including the placement of any directionals). Watch UNIT #s. –The effective date must be on or before the closing date. It is not acceptable to send the binder for the upcoming policy term. We also cannot use the “change effective date” if there is one – we only consider the effective date of the policy. –All purchase transactions must show the first year’s premium either Paid At Closing on the HUD or a paid receipt must be provided. This is required regardless of the borrower’s choice to escrow. –The premium must be included on the hazard insurance regardless of the borrower’s choice to escrow. –Coverage requirements follow investor guidelines.

17 HUD Settlement Statement and Initial Escrow Disclosure All pages of the HUD must be provided.All pages of the HUD must be provided. The settlement and disbursement dates must be completed and correct.The settlement and disbursement dates must be completed and correct. The monthly escrow payments (lines ) must match the monthly escrow payment on the Initial Escrow.The monthly escrow payments (lines ) must match the monthly escrow payment on the Initial Escrow. The opening escrow amount collected on the HUD must match the opening escrow balance on the Initial Escrow.The opening escrow amount collected on the HUD must match the opening escrow balance on the Initial Escrow. When a principal curtailment is done it must appear on the HUD and a check for the curtailment amount must be sent along with your original note and allonge.When a principal curtailment is done it must appear on the HUD and a check for the curtailment amount must be sent along with your original note and allonge. Files with a LTV greater than 80% must escrow regardless of the product type.Files with a LTV greater than 80% must escrow regardless of the product type. Property taxes or hazard insurance premiums that are due within 6 weeks of closing must be paid at closing if the borrower is choosing to escrow.Property taxes or hazard insurance premiums that are due within 6 weeks of closing must be paid at closing if the borrower is choosing to escrow. If the borrower is waiving escrows for either hazard insurance, property taxes, or both the closing package must include a signed original Escrow Waiver form.If the borrower is waiving escrows for either hazard insurance, property taxes, or both the closing package must include a signed original Escrow Waiver form. The amount used for property taxes and hazard insurance must be supported by documentation in the closing package. For hazard insurance, the amount used should always match the binder/policy provided. For property taxes, the amount used must match the title commitment, appraisal, or documentation from the county. A construction to permanent loan may not use an estimate for the property taxes (the 1% used by UW may not be used for Purchasing). We do allow you to use the mill rate obtained from the county times the appraised or assessed value in order to calculate the property tax amount. The Cushion Selected by Servicer on the Initial Escrow must equal one month, and the escrow account balance on the right side must also go down to the one month cushion.

18 Authorization for Automatic Payments Please encourage ACH as an option for your borrowers. A fully completed form must include the following:Please encourage ACH as an option for your borrowers. A fully completed form must include the following: –Loan number, routing number, account number, bank name and address. –The Payment Amount must equal the P&I plus any applicable escrow amounts, and the Automatic Payment Amount should be completed with the amount the borrower would like to pay every month. –The Automatic Payment Start Date must be completed, and may be anywhere from the 1 st through the 15 th of the month. Please note after 8 days the borrower will receive a late fee reminder, so it is important the borrower is aware of that if choosing the 9 th through the 15 th of the month.

19 First Payment Letter –Payment information is correct and is broken down accordingly (taxes and insurance must be listed separately). –Our bank name must appear as Merchants Bank National Association and include our address of PO Box 248 Winona, MN –The first payment date must match the note.

20 I Received a Notice of Suspense… Now What? Please call or the Purchasing Help Desk with any questions.Please call or the Purchasing Help Desk with any questions. Please read the suspense conditions carefully and upload the applicable documents to the Calyx Path file. Submit the conditions within the system to notify Purchasing.Please read the suspense conditions carefully and upload the applicable documents to the Calyx Path file. Submit the conditions within the system to notify Purchasing. Review the extension fee start date and deficiency cure deadline date displayed on the Loan Summary screen.Review the extension fee start date and deficiency cure deadline date displayed on the Loan Summary screen. Please forward any original documents that have been requested. Please do not forward originals if they have not been requested.Please forward any original documents that have been requested. Please do not forward originals if they have not been requested.

21 Ready to Fund! Once all suspense conditions have been cleared (or there were no conditions to begin with) you will receive a notice that your Purchase Advice (PA) is available.Once all suspense conditions have been cleared (or there were no conditions to begin with) you will receive a notice that your Purchase Advice (PA) is available. The PA will reflect all fees and credits and indicate the final amount and date that you will be funded.The PA will reflect all fees and credits and indicate the final amount and date that you will be funded. Please review your PA as soon as possible so that any necessary corrections may be processed prior to us completing the white sheets.Please review your PA as soon as possible so that any necessary corrections may be processed prior to us completing the white sheets.


Download ppt "Purchasing Hints and Tips What You Need To Know To Get a Closing Package Purchased on the First Try."

Similar presentations


Ads by Google