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MetaSource

17Mar

Top 15 Mortgage QC Findings for 2020

March 17, 2021 MetaSource Residential

While very little about 2020 was predictable, it was a year in which mortgage quality control issues fell into a familiar pattern. This findings report includes MetaSource’s top 15 findings along with a deep dive into our #1 finding and best practices for avoiding it.

Top QC Findings for 2020

Here is the complete list of our top findings for 2020, including all loan types and both regulatory and agency findings:

Rank       Finding
1.            Closing Disclosure – Tolerance Violation
2.            Closing Disclosure – Calculation Cash to Close
3.            Closing Disclosure – Defective
4.            Closing Disclosure Timing Violation
5.            Other Application/Processing Documentation – Intent to Proceed
6.            Income not Documented
7.            Other Application/ Processing Documentation – Loan Estimate – Timing Violation
8.           Product Parameter Points and Fees
9.           Insufficient Assets to Close
10.         Income Documentation – Aged
11.         DU or AUS Findings Report – Missing or Defective
12.         Incorrect Income Calculation
13.         Security Instrument – Missing or Defective
14.         Closing/Title Documentation – Closing Disclosure – Defective
15.         Note – Missing or Defective

#1 Finding: A Continuous Trend

Closing disclosure defects remain lodged firmly in the top five of our annual QC findings, where they have put down roots every year since TRID Rules took effect more than five years ago.

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30Oct

TRID Turns 5: What We’ve Learned About Successfully Managing Mortgage Origination Compliance

October 30, 2020 MetaSource Residential
MetaSource

Five years ago, big changes to federal requirements for the mortgage loan disclosure processes produced great anxiety in the lending world. Lenders feared they were facing an onslaught of complicated, new compliance demands that would inflate the cost and risks of every loan origination and leave them perpetually at risk of penalties.

The TILA- RESPA Integrated Disclosure (TRID) rules were instituted in late 2015 and administered by the Consumer Financial Protection Bureau. TRID consolidated four existing disclosures required under TILA and RESPA for closed-end credit transactions secured by real property into two forms:

  • The Loan Estimate (LE) replaced the Good Faith Estimate (GFE) and initial Truth-in-Lending Disclosure, which are provided to consumers at the start of the transaction and include both initial disclosures and timing restrictions (must be provided within 3 business days from the date the application is received)
  • The Closing Disclosure (CD) replaced the HUD-1 Settlement Statement and final Truth-in-Lending Disclosure, providing consumers the required 3 days to review all final terms and conditions and seeking to prevent borrowers from signing documents under duress

Lenders’ anxiety around these new rules was based on the lack of clear guidance from the CFPB, the myriad interpretations by varying investors, and potential penalties associated with non-compliance.

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