- Business Rules
Do you define “exempt” to mean we are not “allowed” to use the new forms or not “required” to use them? Can we send the new forms on a HELOC for example in lieu of the old? Can we use the new disclosures on all transactions?Exempt meaning not applicable under the requirements of §1026.19(e), (f) & (g) regarding the use of the Loan Estimate and Closing Disclosure. However, the use of the model forms is allowable if properly completed with accurate content and meets the provisions requiring clear and conspicuous and segregation requirements regarding non-federally related mortgage transactions.
In terms of a HELOC loan or Reverse Mortgage specifically, the use of the Loan Estimate and Closing Disclosure would be problematic since the HELOC disclosure requirements under §1026.40(d) and the Reverse Mortgage requirements under §1026.33(b) would not be supported by the use of these forms.
In terms of all transactions (such as the partial exemption for certain junior liens), there are too many possible scenarios and potential transaction types to provide a complete answer in this document. We would recommend you have policies based on an analysis of each property type, product type, occupancy, lien position, etc., after consultation with legal counsel or your compliance department. In addition, you will need to ascertain the acceptance of the use of any variance in disclosure forms used with your investors if you sell your mortgage loans in the secondary market.
Citation(s): Commentary ¶37(o)(3) and ¶38(t)(3)-1; 78 FR 79795-78796
CFPB announcement regarding the delay of TRID
The full statement from CFPB Director Richard Cordray can be viewed here