USDA Reduces the Upfront and Annual Guarantee Fees
On March 31, 2016, the USDA announced a reduction in the upfront guarantee fee and the annual guarantee fee, effective for all loans obligated by the USDA on or after Oct. 1, 2017. A loan is obligated when the USDA has issued Form RD 3555-18 “Conditional Commitment for Single Family Housing Loan Guarantee” to the lender and approved a complete loan application package. For all loans obligated on or after Oct. 1, 2017, the loan will be subject to a one percent upfront guarantee fee and a 0.35 percent annual fee. Currently, the upfront guarantee fee is 2.75 percent and the annual fee is 0.50 percent.
Fannie Mae and Freddie Mac Release Redesigned URLA/Form 1003
Fannie Mae and Freddie Mac released to the public their redesigned Uniform Residential Loan Application (aka Form 1003, URLA) on Aug. 23, 2016. This is the first redesign by the GSEs of the URLA in more than 20 years.
The form is designed to assist lenders in collecting additional information required under the HMDA revisions, which are effective beginning with applications dated Jan. 1, 2018, and after. Accordingly, the redesigned URLA is not to be used by lenders until Jan. 1, 2018, but its use is not mandatory by the GSEs at that time. For those users who are not able to use the redesigned URLA at that time, the release also includes a new Demographic Information Addendum which can be used with the existing URLA to capture additional HMDA data. The GSEs have not yet published a mandatory use date for the redesigned URLA.
In addition to modifications to the fields of information collected on the URLA, the redesign also modified the form to only collect applicable information through dynamic sections. Sections that are applicable to the transaction will expand to show all pertinent data. Sections that are inapplicable to the transaction or borrower are collapsed. These features are similar to the CFPB’s Loan Estimate and Closing Disclosure which removes inapplicable disclosures to the borrower so as to prevent overloading the borrower with information.
Updates to the FEMA Standard Flood Hazard Determination Form
The Standard Flood Hazard Determination Form has been updated with changes by the Federal Emergency Management Agency (FEMA) on June 1, 2016. The previous form originally expired May 30, 2015.
FEMA’s Web site states that the previous May 30, 2015 form can continue to be used during the "phase in" period of the updated form. However, note that FEMA’s Web site does not indicate how long the phase in period is.
Gavin T. Ales is chief compliance officer with Torrance, Calif.-based DocMagic Inc. He may be reached by phone at (800) 649-1362, ext. 6446 or e-mail [email protected].
This article originally appeared in the October 2016 print edition of National Mortgage Professional Magazine.
