- Business Rules
How will USDA monthly payments be reflected in the projected payments since it decreases every year?The loan estimate requires the creditor to disclose the initial periodic payment or range of payments. The disclosure required is of the actual periodic payment or range of payments that corresponds to the interest rate that will apply at consummation. Commentary ¶37(c)(1)(i)(C)-1, states:
"Mortgage insurance or any functional equivalent" includes any mortgage guarantee that provides coverage similar to mortgage insurance (such as a United States Department of Veterans Affairs or United States Department of Agriculture guarantee), even if not technically considered insurance under State or other applicable law. The fees for such a guarantee are included in "mortgage insurance premiums."
Commentary ¶37(c)(1)(i)(C)-2, states:
"The table required by §1026.37(c) should reflect the consumer's mortgage insurance premiums until the date on which the creditor must automatically terminate coverage under applicable law, even though the consumer may have a right to request that the insurance be cancelled earlier. Unlike termination of mortgage insurance, a subsequent decline in the consumer's mortgage insurance premiums is not, by itself, an event that requires the disclosure of additional separate periodic payments or ranges of payments in the table required by §1026.37(c). For example, some mortgage insurance programs annually adjust premiums based on the declining loan balance. Such annual adjustment to the amount of premiums would not require a separate disclosure of a periodic payment or range payments.
Where "mortgage insurance or any functional equivalent" decreases, the projected payments table requires the disclosure of the maximum amount payable for mortgage insurance premiums corresponding to the principal and interest payment for the column under which it is disclosed pursuant to 1026.37(c)(2)(i)."
Citation(s): 1026.37(c)(1)(i); 1026.37(c)(2)(ii); and Commentary ¶37(c)(1)(i)(C)-1 & -2.
CFPB announcement regarding the delay of TRID
The full statement from CFPB Director Richard Cordray can be viewed here