Compliance Calendar

Indiana House Bill 1487 

• Amends the law concerning the business practices of the secretary of state, including: (1) access to information maintained by the secretary of state; (2) use of electronic information and transmissions; (3) striking the current Uniform Commercial Code (UCC) financing statement form; adding use of a format that meets certain criteria for the filings; and amending the UCC fees; (4) adding to the requirement to include a notary public's Indiana county on an authentication certificate; (5) amending requirements concerning notary public examination and education; (6) prohibiting performance of a notarial act: (a) to benefit oneself or one's spouse; or (b) when a commission is suspended or revoked; (7) specifying a notarial act fee applies; (8) providing for issuance of a certificate of fact for a notary public per signature; (9) requiring maintenance of a remote notary public electronic journal for 10 years; and (10) providing for nonresident corporate service of process on the secretary of state. 
• Repeals current law concerning excavation contractor filings and precontracting documentation of compliance with underground facility damage law. 
• Requires the formatting of certain documents to be approved by the International Association of Commercial Administrators or the secretary of state. 
• Specifies October 1, 2019, as the date for a fee increase concerning the indexing of certain documents. 
• Makes the law concerning remote notarial acts applicable only to a remote notarial act performed after the earlier of the effective date of certain administrative rules or July 1, 2020. 
• Increases the fee that a notary public may charge for a remote notarial act from $15 to $25. 
• Provides that, for certain filings, the provision of an electronic mail address is discretionary. Makes a technical amendment and conforming changes.

This bill becomes effective on July 1, 2019; compliance is effective upon the earlier of the Secretary of State adopting implementing rules under IC 33-42-16-2, or July 1, 2020.

We have removed the reference to the lease being “documented as assigned from the property Seller to the Borrower” from the “Lease Requirements” row in the “Rental income from property owned in the prior calendar year” chart in Section 5306.1(c)(iii). The reference was inadvertently included with a prior publication.

Guide impact: Section 5306.1

The Nebraska Secretary of State has adopted the proposed regulations relating to the "Electronic Notary Public Act".

• Requires a conveyance, a mortgage, or an instrument of writing to be recorded to be: (1) acknowledged by the grantor; and (2) proven before certain specified individuals (e.g., a notary public); in certain instances. 
  • Note: Previous to this amendment, an instrument could be recorded if it is either acknowledged or proved.

• Amends Regulation X to temporarily permit mortgage servicers to offer certain loss mitigation options based on the evaluation of an incomplete loss mitigation application (under the CARES Act)
• Eligible loss mitigation options, among other things, must permit borrowers to delay
  paying certain amounts until the mortgage loan is refinanced, the mortgaged property is sold, the term of the mortgage loan ends, or, for a mortgage insured by the Federal Housing Administration (FHA), the mortgage insurance terminates
  • These amounts include, without limitation, all principal and interest payments forborne through payment forbearance programs made available to borrowers experiencing financial hardships due, directly or indirectly, to the COVID-19 emergency, including a payment forbearance program offered pursuant to section 4022 of the Coronavirus Aid, Relief, and Economic Security Act
  • These amounts also include principal and interest payments that are due and unpaid by borrowers experiencing financial hardships due, directly or indirectly, to the COVID-19 emergency

2019-09 See alert here for details of five amendments passed

• CA A.B. 25 (2019)
• CA A.B. 874 (2019)
• CA A.B. 1146 (2019)
• CA A.B. 1355 (2019)
• CA A.B. 1564 (2019)

2010-10 See alert here for details of the proposed attorney general regulations

Consumer Rights

The legislation provides for the following consumer rights:

• A consumer (defined as a California resident) has the right to request that a business (defined below) that collects a consumer's personal information (defined below) disclose to that consumer the categories and specific pieces of personal information that the business has collected.

• A business that collects a consumer's personal information shall, at or before the point of collection, inform consumers as to the categories of personal information to be collected and the purposes for which the categories of personal information shall be used. A business is forbidden from collecting additional categories of personal information or using personal information collected for additional purposes without providing notice to the consumer.

• A consumer has the right to request that a business delete any personal information about the consumer that the business has collected.

• A consumer has the right to request that a business that collects personal information about the consumer disclose: (a) the categories of personal information it has collected about that consumer, (b) the categories of sources from which the personal information is collected, (c) the business or commercial purpose for collecting or selling personal information, (d) the categories of third parties with whom the business shares personal information, and (e) the specific pieces of personal information it has collected about that consumer.

• A consumer has the right to request that a business that sells the consumer's personal information, or that discloses it for a business purpose, disclose: (a) the categories of personal information that the business collected about the consumer, (b) the categories of personal information that the business sold about the consumer and the categories of third parties to whom the personal information was sold, by category or categories of personal information for each third party to whom the personal information was sold, and (c) the categories of personal information that the business disclosed about the consumer for a business purpose.

• A consumer has the right, at any time, to direct a business that sells personal information about the consumer to third parties not to sell the consumer's personal information.

• A business cannot sell the personal information of consumers if the business has actual knowledge that the consumer is younger than 16 years old, unless the consumer—in the case of consumers who are between 13 and 16—or the consumer's parent or guardian, in the case of consumers who are younger than 13, has affirmatively authorized the sale of the consumer's personal information.

To comply with these requirements, businesses are required to make available two or more methods for submitting consumer verified requests and the information must be provided to the consumer within 45 days of the verified request.

Online Privacy Notice Requirements

The law requires entities to list specific information in their online privacy policies, including:

• a description of the consumers' rights as discussed above;

• a list of the categories of personal information that the business has collected about consumers in the preceding 12 months;

• a list of the categories of personal information it has sold about consumers in the preceding 12 months; and

• a list of the categories of personal information it has disclosed about consumers for a business purpose in the preceding 12 months.

If applicable, a business also must provide a clear and conspicuous link on the business' homepage titled “Do Not Sell My Personal Information,” which should lead to a web page enabling a consumer—or a person authorized by the consumer—to opt out of the sale of the consumer's personal information. That information also should be provided in the business' online privacy policy.

Enforcement

The law creates a complicated enforcement mechanism for private litigants and the California Attorney General's office.

[See alert for complete details]

Amends the Mississippi's S.A.F.E. Mortgage Act to 

Extends and clarify the time period during which mortgage brokers are required to maintain their books, accounts and records

• Section 81-18-21.  Books, accounts and records shall be maintained apart and separate from any other business in which the person is involved and may represent historical data for five (5) years from the final disposition of the loan application to which the records relate. 

Clarifies the type of estimate of costs provided to the borrower.

• Section 81-18-33. A copy of the loan estimate of costs provided to the borrower

Fannie Mae is providing a new temporary structure for incentive fees effective July 1, 2020 and until further notice for all: 

• completed repayment plans with due dates on or after July 1, 2020,
• payment deferrals/COVID-19 payment deferrals completed on or after July 1, 2020, and 
• Fannie Mae Flex Modifications completed with a Trial Period Plan effective date on or after July 1, 2020.  

Beginning on this effective date, incentive fees will be cumulatively capped at a total of $1,000 per mortgage loan, regardless of whether the initial retention workout option and any subsequent retention workout option were as a result of the same hardship. Workout options already begun prior to this effective date will not be subject to the cumulative incentive fee cap. 

N O T E : Existing incentive fees for liquidation workout options will remain unchanged at this time and are not subject to the incentive cap. 

See LL-2020-09 for complete details.

Additions and Updates to Lender Letter on May 27, 2020 

• Operational requirements related to reporting and completing a COVID-19 payment deferral 
• The process for obtaining reimbursement for expenses related to a COVID-19 payment deferral
• Reporting a delinquency status code for a COVID-19 payment deferral

• Reporting a COVID-19 payment deferral to Fannie Mae 

• Paying expenses and requesting reimbursement related to a COVID-19 payment deferral
  

• Updates to the Investor Reporting Manual

Additions and Updates to Lender Letter on May 27, 2020 

• Operational requirements related to reporting and completing a payment deferral 
• The process for obtaining reimbursement for expenses related to a payment deferral
• Reporting a delinquency status code for a payment deferral
• Reporting a payment deferral to Fannie Mae 
• Updates to the Investor Reporting Manual

Implements, in whole or in part, Iowa Code chapter 9B establishing procedures for electronic and remote notarial acts effective July 1, 2020.

CHAPTER 43 NOTARIAL ACTS

• 721—43.1(9B) Certificate of notarial acts. A notarial act shall be evidenced by a certificate signed and dated by a notarial officer, be executed contemporaneously with the performance of the notarial act for which the certificate applies, and not be completed until the notarial act has been performed. The certificate shall include all of the information required by Iowa Code section 9B.15(1). A certificate of a notarial act is sufficient if it meets the requirements set out in Iowa Code section 9B.15(3). A certificate of a notarial act performed under Iowa Code section 9B.14A as enacted by 2019 Iowa Acts, chapter 44, section 6, must also meet the requirements of Iowa Code section 9B.14A(4) as enacted by 2019 Iowa Acts, chapter 44, section 6.
• 721—43.2(9B) Short form certificates. Short form certificates of notarial acts may be used provided the certificates comply with the provisions of Iowa Code sections 9B.15 and 9B.16. For purposes of this rule, a "record" and an "instrument" have the same meaning and effect. A short form certificate of a notarial act performed under Iowa Code section 9B.14A as enacted by 2019 Iowa Acts, chapter 44, section 6, must meet the requirements of Iowa Code section 9B.14A(5) as enacted by 2019 Iowa Acts, chapter 44, section 6.
• 721—43.3(9B) Jurisdiction. For purposes of complying with the requirements of Iowa Code sections 9B.15 and 9B.16, the jurisdiction in which the notarial act is performed is determined by the location of the notary public in this state at the time the notarial act is performed.
• 721—43.4(9B) Conflict of interest. A notarial officer shall not perform a notarial act that creates a conflict of interest as prohibited in Iowa Code section 9B.4(2). For purposes of this rule, a direct financial benefit does not exist when the notarial officer is compensated on an individual loan commission basis or as provided in Iowa Code section 9B.26(2).

See ARC 5041C for complete details on notary application, approval, reapproval, training, etc.

This lender letter is announcing the Fannie Mae Payment Deferral solution that makes several adjustments to the requirements of the standard Payment Deferral to create the COVID-19 Payment Deferral, which is designed specifically to assist Borrowers who have a COVID-19 related hardship.

Refer to the letter for the numerous specific details, guidance and eligibility requirements and exclusions.

This bulletin is announcing the Freddie Mac Payment Deferral solution that makes several adjustments to the requirements of the standard Payment Deferral to create the COVID-19 Payment Deferral, which is designed specifically to assist Borrowers who have a COVID-19 related hardship.

Refer to the bulletin for the numerous specific details, guidance and eligibility requirements and exclusions.

The dollar amounts indexed in the Regulated Loan Act, Minnesota Statutes, Chapter 56, and the Minnesota Consumer Credit Code, Minnesota Statutes, Section 47.59, will increase 10% effective July 1, 2020.

Below are highlights of select consumer credit code provisions; please see the chart for a complete list. 

Chapter 47 amounts:

• Default charges: M.S. § 47.59, subd. 6(a)(4) - $8.84
  
• Loan Administrative Fee: M.S. 47.59, subd. 6(d) - $7,344

Chapter 56 amounts:

• Assumption fee: M.S. § 56.12 - $408
• Maximum closing costs on real estate secured loans: M.S. § 56.131, subd. 2(b)  - $680 
• Minimum new funds advance for discount point and appraisal fees: M.S. § 56.131, subd. 2(d)

• Permanently raises the threshold for reporting data about closed-end mortgage loans from 25 to 100, so that institutions originating fewer than 100 closed-end mortgage loans in either of the two preceding calendar years will not have to report such data effective July 1, 2020 
• For calendar year 2021, an institution will not be required to collect HMDA data for closed-end mortgage loans if it originated fewer than 100 closed-end mortgage loans during either 2019 or 2020.
  
  • Collection: Newly excluded institutions can stop collecting HMDA data on their closedend mortgage loans beginning on July 1, 2020. Note, though, that other laws or regulations may require collection of certain data on home loan activity. For example, Regulation B includes an independent requirement to collect information regarding the applicant’s ethnicity, race, sex, marital status, and age where the credit sought is primarily for the purchase or refinancing of a dwelling that is or will be the applicant’s principal residence and will secure the credit. 
  • Recording: Newly excluded institutions must still record closed-end data for the first quarter of 2020 on a loan/application register by 30 calendar days after the end of the first quarter. They will not, however, be required to record closed-end data for the second quarter of 2020 because the deadline for recording that data is after July 1, 2020. 
  • Reporting: Because newly excluded institutions collecting HMDA data in 2020 would not otherwise report those data until early 2021, the final rule relieves newly excluded institutions of the obligation to report by March 1, 2021 data collected in 2020 on closed end mortgage loans (including data collected in 2020 before July 1, 2020). Under the final rule, a newly excluded institution may report voluntarily HMDA data on closed-end mortgage loans in 2021 as long as the institution reports data for the full calendar year 2020.

The South Carolina Department of Consumer Affairs published changes to the dollar amounts under its Consumer Protection Code, including late fees.

The maximum late charge permitted under S.C. Code Ann. § 37-3-203(1) & (2) has increased from $18.50 to $21.00.

Iowa Senate Bill 475 provides for notarial acts, including by providing for the use of electronic media, providing penalties, and including effective date provisions. 

Reg CC Inflation Adjustment Requirements

• $200 is changing to $225 (Note: the $200 amount is still referred to $100 in Reg CC).   This amount is used on case-by-case holds and will impact most financial institutions.
• $5,000 is changing to $5,525.  This amount is used on certain special exception holds, such as large deposit holds, new account holds, and repeatedly overdrawn holds.  This change will also impact most financial institutions. 
•  $400 is changing to $450.  This relates to the rarely used rule that permits financial institutions to extend holds by one business day when a deposit is taken for withdrawal by cash or similar means. 
• Civil liability under Regulation CC has been changed from $1,000 and $500,000 to $1,100 and $552,500 respectively.

Notification Requirements

• The change of terms requirements of Regulation CC will be triggered every time there is an adjustment for inflation, and this starts with the 2020 changes to Regulation CC which are required by July 1, 2020.
• Change-in-terms rules of Regulation CC require a financial institution to send a written notice to consumer account holders at least 30 days before implementing a change to the institution’s funds-availability policy and further states that “any change which expedites the availability of such funds shall be disclosed not later than 30 days after implementation.”  
• Changes made solely related to inflation adjustments must be sent no later than 30 days after implementation as the increased threshold amounts actually make funds available to consumers sooner than they did in the past.   
• All customers must be notified of the inflation adjustment changes by July 31, 2020 (assuming financial institutions don’t implement the a changes sooner than July 1, 2020).

Important Note:

Regulation CC requires that you notify affected customers of these changes to your funds availability policy. Since these changes expedite the availability of funds, you must notify them no later than 30 calendar days after the changes take effect. Thus, you have until July 31st. That said, you do still have the option of notifying them prior to the effective date if you wish. Due to different statement cut-off dates, you may want to start the notification process before the July 1st effective date. Whichever timing option you choose, remember:

A notice may be given in any form as long as it is clear and conspicuous. If the bank gives notice of a change by sending the customer a complete new availability disclosure, the bank must direct the customer to the changed terms in the disclosure by use of a letter or insert, or by highlighting the changed terms in the disclosure.

There is no model language for this notification but something similar to the following could be used:

Effective 7/1/2020, we are increasing the amount we make available for withdrawal by checks not subject to next day availability to $225. In addition, the amount available for withdrawal on exception holds for large deposits and new account holds is increasing to $5,525.

With this Bulletin we are updating the Guide to add Section 2403.12, which includes requirements regarding corrections by means of Post-Fund Data Correction tool (the “Tool”). 

As announced in Servicing Bulletin 2019-23, new users may request access to the Tool by:

• Seller/Servicer’s Access Manager Administrator providing access to authorized users; or
• For Seller/Servicers that do not use Access Manager, by completing and submitting Form 907, Post-Fund Data Correction Tool Authorized User Role Form, available on the Post-Fund Data Correction Tool page

• Creates a chief privacy officer 
• Directs the State to conduct a privacy audit concerning the collection and use of citizens’ data 
• Adopts a student online privacy protection act 
• Expands the definition of personally identifiable information subject to the Security Breach Notice Act and ensure consumer notice of a data breach 
• Requires internet service providers to provide notice concerning the potential sharing of private data

• Amends section 26-2239, Idaho code, to revise terminology and to provide a correct code reference
• Repeals Chapter 28, Title 26 the "Mortgage Company Act", effective July 1, 2020.  This section includes the following:
  
  • 26-2801   SHORT TITLE. 
  • 26-2802   DEFINITIONS. 
  • 26-2803   EXEMPTIONS. 
  • 26-2804   UNLAWFUL ACTS. 
  • 26-2805   POWERS AND DUTIES OF DIRECTOR. 
  • 26-2806   REMEDIES AVAILABLE TO THE DEPARTMENT. 
  • 26-2807   RESERVE ACCOUNTS. 
  • 26-2808   ANNUAL STATEMENTS. 
  • 26-2809   NOTICE OF TRANSFER. 
  • 26-2810   COMPLAINTS. 26-2811   SEVERABILITY.
• Amends section 26-31-102, Idaho code, to revise definitions, to define a term, and to make technical corrections
• Amends section 26-31-201, Idaho code, to revise a definition, to remove definitions, to define a term, and to make technical corrections
• Amends section 26-31-202, Idaho code, to revise an exemption and to make technical corrections
• Amends section 26-31-206, Idaho code, to remove references to a qualified person and to make technical corrections
• Amends section 26-31-207, Idaho code, to remove a reference to a qualified person and to make technical corrections
• Amends section 26-31-211, Idaho code, to revise a certain prohibited practice, to remove a reference to a qualified person, and to make technical corrections
• Amends chapter 31, title 26, Idaho code, by the addition of a new section 26-31-212, Idaho code, to provide for certain requirements regarding reserve accounts
  • 26-31-212. RESERVE ACCOUNTS. (1) A mortgage lender shall, conspicuously and specifically, disclose to each borrower all contractual provisions relating to reserve accounts, impound accounts, escrow accounts, or any other account maintained for the borrower in order to pay for property taxes, property insurance, or private mortgage insurance.
    (2) Except as otherwise required by the truth in lending act, the real estate settlement procedures act, regulation X, or regulation Z, a mortgage lender shall not keep more than one hundred twenty percent (120%) of the amounts necessary on an annual basis to pay expected insurance, taxes, or other agreed charges. Upon written notice by a borrower to the mortgage lender that reserves being required are excessive, the mortgage lender must, within thirty (30) days, either refund the excess or explain to the borrower why the amounts being required are believed to be reasonable and necessary. If, after notice of hearing under chapter 52, title 67, Idaho Code, the director determines that the reserve account, impound account, escrow account, or any other similar account maintained for a borrower is not reasonable, the director may order the mortgage lender to reduce its reserve requirements for such accounts. In any proceeding under this section, the burden shall be upon the mortgage lender to prove that the amounts required for such reserve accounts are based upon actual and reasonably anticipated charges.
• Amends chapter 31, title 26, Idaho code, by the addition of a new section 26-31-213, Idaho code, to provide for certain annual statements
  • 26-31-213. ANNUAL STATEMENTS. (1) A mortgage lender shall deliver to the borrower at least annually, during the month of January, a statement of the borrower ' s account showing the date and amount of all payments made or credited to the account for the immediately preceding twelve (12) month period and the total unpaid balance. The statement shall also clearly describe in full the amounts received on all tax and insurance reserve accounts, the disposition of such funds, and the amounts held in reserve in such accounts. The statement shall clearly indicate any penalty or interest payments because of failure to pay taxes on time. A fee shall not be charged to the borrower for the statements.
    (2) A borrower may request additional statements from a mortgage lender at any time, and the mortgage lender may, unless otherwise prohibited by law, require a fee to provide each such statement. The statement shall be delivered to the borrower within thirty (30) days after receipt of a written request from the borrower.
• Amends chapter 31, title 26, Idaho code, by the addition of a new section 26-31-214, Idaho code, to provide for a notice of transfer of a borrower's residential mortgage loan
  • 26-31-214 . NOTICE OF TRANSFER. Except as otherwise provided for in the truth in lending act, the real estate settlement procedures act, regulation X, or regulation Z, a mortgage lender shall provide notice to the borrower within fifteen (15) days after any sale or assignment of the borrower's residential mortgage loan to another person wherein the mortgage lender does not retain the loan servicing. A mortgage lender purchasing or receiving assignment of a residential mortgage loan with servicing shall provide to the borrower within thirty (30) days a written statement describing policies relating to the reserve account.
• Amends section 26-31-304, Idaho code, to provide for temporary authority to originate loans in certain instances and to make technical corrections

SECTION 2. IC 24-4.5-2-201, AS AMENDED BY P.L.91-2013, SECTION 1

• Removes exemption for Revolving Charge Accounts
• (3) In the case of a sale agreement entered into before July 1,
  2020, this section does not limit or restrict the manner of contracting for the credit service charge, whether by way of add-on, discount, or otherwise, so long as the rate of the credit service charge does not exceed that permitted by this section
• (NEW) (4) New restrictions apply to a sale agreement for a consumer
  credit sale (or for the refinancing or consolidation of a consumer credit sale) that is entered into after June 30, 2020 (see bill)
• (NEW) (6) With respect to a consumer credit sale made pursuant to a
  revolving charge account, the parties to the sale may contract for the payment by the buyer of a credit service charge not exceeding... (see bill)
• (8) With respect to a consumer sale other than a sale under a revolving charge account, the seller may contract for and receive a minimum credit service charge of not more than thirty dollars ($30)
• (NEW) (11) This subsection applies to a sale agreement entered into
  after June 30, 2020; in addition to the credit service charge and to any other fees permitted, a seller may contract for and receive a nonrefundable prepaid finance charge in an amount which is not more than seventy-five dollars ($75) for an amount financed which is two thousand dollars ($2,000) or less; (b) one hundred fifty dollars ($150) for an amount financed which is more than two thousand dollars ($2,000) but does not exceed four thousand dollars ($4,000); and (c) two hundred dollars ($200) for an amount financed which is more than four thousand dollars ($4,000)
  
  • Any amount charged by the seller, other than by a seller that is a depository institution, that exceeds the applicable amount permitted by this subsection constitutes a violation of this article and is subject to
    refund
  • Any amount charged by a depository institution that exceeds the applicable amount set forth in this subsection is subject to refund

SECTION 3. IC 24-4.5-2-204, AS AMENDED BY P.L.186-2015, SECTION 12

• This section applies only to a consumer credit sale, refinancing, or consolidation, that is entered into before July 1, 2020

SECTION 4. IC 24-4.5-2-205, Section 205

• For the purpose of determining the credit service charge permitted, the provisions for where the transaction was precomputed only applies to a
  transaction entered into before July 1, 2020

SECTION 5. IC 24-4.5-2-207 IS REPEALED

SECTION 6. IC 24-4.5-2-208 (minor technical amendment)

SECTION 7. IC 24-4.5-2-209, AS AMENDED BY P.L.73-2016, SECTION 8

• The total credit service charge at time of prepayment now excludes the
  nonrefundable prepaid finance charge in the case of a sale agreement entered into after June 30, 2020

SECTION 8. IC 24-4.5-2-210,  Sec. 210

• Provisions regarding rebates upon prepayment are only applicable to transactions entered into before July 1, 2020

SECTION 9. IC 24-4.5-2-602, AS AMENDED BY P.L.73-2016, SECTION 9

• (NEW) (3) Defines restrictions applicable to a loan agreement for a consumer loan (or for the refinancing or consolidation of a consumer loan) that is entered into after June 30, 2020
• (9) (b) In the case of consumer loan that is not secured by an interest
  in land, a lender may contract for and receive a nonrefundable prepaid finance charge of fifty dollars ($50) if the loan agreement is entered into before July 1, 2020
• (9) (b) If the loan agreement is entered into after June 30, 2020, a lender may contract for and receive a nonrefundable prepaid finance charge of not more than the following:  
  • (i) Seventy-five dollars ($75), in the case of a loan agreement for a principal amount which is two thousand dollars ($2,000) or less. 
  • (ii) One hundred fifty dollars ($150) in the case of a loan agreement for a principal amount which is more than two thousand dollars ($2,000) but does not exceed four thousand dollars ($4,000). 
  • (iii) Two hundred dollars ($200) in the case of a loan agreement for a principal amount which is more than four thousand dollars ($4,000)
    • Any amount charged by the seller, other than by a seller that is a depository institution, that exceeds the applicable amount permitted by this subsection constitutes a violation of this article and is subject to refund
    • Any amount charged by a depository institution that exceeds the applicable amount set forth in this subsection is subject to refund

SECTION 11. IC 24-4.5-3-204, AS AMENDED BY P.L.175-2015, SECTION 14

• (1) This section applies only to a consumer loan, refinancing, or consolidation, that is entered into before July 1, 2020

SECTION 14. IC 24-4.5-3-209, AS AMENDED BY P.L.159-2017,SECTION 12 (minor technical amendment)

SECTION 15. IC 24-4.5-3-210

• (1) This section applies only to a o a loan agreement that is entered into before July 1, 2020

SECTION 16. IC 24-4.5-3-508,AS AMENDED BY P.L.159-2017, SECTION 14

• (3) In the case of a loan agreement entered into before July 1, 2020, this section does not limit or restrict the manner of contracting for the loan finance charge, whether by way of add-on, discount, or otherwise, so long as the rate of the loan finance charge does not exceed that permitted by this section
  • After June 30, 2020, a loan agreement may not be entered into for
    a precomputed supervised loan
• (8) In addition to the loan finance charge provided for in this section and to any other charges and fees permitted by this chapter, the lender may contract for and receive a nonrefundable prepaid finance charge of not more than fifty dollars ($50) if the loan agreement is entered into before July 1, 2020.
  • If the loan agreement is entered into after June 30, 2020, not more than the following: 
    • (a) Seventy-five dollars($75), in the case of a loan agreement for a principal amount which is two thousand dollars($2,000) or less. 
    • (b) One hundred fifty dollars ($150) in the case of a loan agreement for a principal amount which is more than two thousand dollars ($2,000) but does not exceed four thousand dollars ($4,000). 
    • (c) Two hundred dollars ($200) in the case of a loan agreement for a principal amount which is more than four thousand dollars ($4,000)
      • Any amount charged by the seller, other than by a seller that is a depository institution, that exceeds the applicable amount permitted by this subsection constitutes a violation of this article and is subject to refund
        
      • Any amount charged by a depository institution that exceeds the applicable amount set forth in this subsection is subject to refund

SECTION 17. IC 24-4.5-4-107, AS AMENDED BY P.L.141-2005, SECTION 2 (minor technical amendment)

Makes various changes to the statutes concerning:

• (1) first lien mortgage lenders; 
• (2) persons licensed under the Uniform Consumer Credit Code (UCCC); 
• (3) civil proceeding advance payment providers; 
• (4) debt management companies; 
• (5) banks; 
• (6) credit unions; 
• (7) pawnbrokers; 
• (8) money transmitters; and 
• (9) licensed cashers of checks. 

Repeals a provision in the statute governing credit unions that concerns loans made by a credit union to the credit union's individual directors and committee members. 

Amends a provision in the statute governing credit unions that concerns loans made by a credit union to the credit union's individual officers to: 

• (1) include extensions of credit made to the credit union's individual directors and supervisory committee members (and to the immediate family members and related interests of the credit union's individual directors and supervisory committee members); and 
• (2) specify that such extensions of credit shall be made in accordance with Regulation O of the Board of Governors of the Federal Reserve System. 

Provides that an appraisal required in connection with a real estate mortgage loan to a credit union member must be: 

• (1) a written appraisal; or 
• (2) a written estimate of market value; consistent with the appraisal standards and transaction value limitations set forth in the appraisal regulations of the National Credit Union Administration.

Fannie Mae is introducing payment deferral, a new workout option that enables servicers to assist eligible borrowers who have resolved a temporary hardship and resumed their monthly contractual payments but cannot afford either a full reinstatement or repayment plan to bring the loan current. 

Please read the Lender Letter for complete requirements for the payment deferral: 

▪ Determining eligibility for a payment deferral 

▪ Determining eligibility for a payment deferral for a Texas Section 50(a)(6) loan 

▪ Determining the payment deferral terms 

▪ Completing a payment deferral 

▪ Processing a payment deferral for an MBS mortgage loan 

▪ Processing a payment deferral for a mortgage loan with mortgage insurance 

▪ Handling fees and late charges in connection with a payment deferral 

▪ Incentive fees ▪ Servicing fees for a payment deferral 

▪ Requesting reimbursement for payment deferral expenses 

▪ Fannie Mae workout hierarchy ▪ Updates to Fannie Mae Flex Modification 

▪ Reporting responsibilities for payment deferral 

▪ Borrower Solicitation Letter (Form 745) 

Effective: Servicers are encouraged to begin evaluating borrowers for payment deferral in accordance with this Lender Letter on or after Jul. 1, 2020; however, servicers must begin evaluating borrowers for payment deferral no later than Jan. 1, 2021. Also, these policy changes will be reflected in the Dec. 2020 update of the Servicing Guide.

Freddie Mac is introducing payment deferral, a new workout option that enables servicers to assist eligible borrowers who have resolved a temporary hardship and resumed their monthly contractual payments but cannot afford either a full reinstatement or repayment plan to bring the loan current. 

Please read the Bulletin for complete requirements for the payment deferral: 

▪ Borrower eligibility

▪ Mortgage/property eligibility

▪ Borrower documentation

▪ Eligibility exclusions

▪ Determining the terms of the Payment Deferral

▪ Completing a Payment Deferral

▪ Payment Deferral Agreement

▪ Evaluation hierarchy

▪ Eligible Disasters and COVID-19

▪ Workout Prospector®

▪ Other requirements

Effective: Servicers are encouraged to begin evaluating borrowers for payment deferral in accordance with this Lender Letter on or after Jul. 1, 2020; however, servicers must begin evaluating borrowers for payment deferral no later than Jan. 1, 2021. 

• Adopts the Uniform Power of Attorney Act

The CFPB has amended Regulation C to increase the threshold for reporting data about closed-end mortgage loans, so that institutions originating fewer than 100 closed-end mortgage loans in either of the two preceding calendar years will not have to report such data.

The Oklahoma Department of Consumer Credit published its annual changes in dollar amounts for 2020 which includes late fees.

The maximum late charge for delinquent payments on a consumer loan or revolving loan account as promulgated in Okla. Stat. Ann. tit. 14A, § 3-203(1) & (5) has increased from $26.00 to $26.50.

This Bulletin provides updates regarding certain temporary COVID-19-related requirements and flexibilities announced in previous Bulletins, including:

• The extension of the effective dates for previously announced temporary requirements and flexibilities
• The process for verifying that a self-employed Borrower’s business is open and operating
• The extension of the effective date for Sellers' post-funding quality control requirements

We are also reminding Sellers of additional resources, including our Selling FAQs related to COVID-19, which were recently updated to include guidance related to the following:

• Self-employed Borrowers, and
• Assessment of fluctuating employment income (fluctuating hourly income, commission, bonus, overtime and tip income) during the pandemic based on the existing requirements of Guide Sections 5303.2(b), 5303.3 and 5303.4

As announced in our June 29, 2020, Single-Family News Center article, Loan Product Advisor and the Home Possible Income & Property Eligibility tool will be updated on July 12, 2020 to reflect the 2020 area median income (AMI) limits.

The FHFA provides the AMI estimates to Freddie Mac, which we use to determine if the Borrower’s annual qualifying income meets Home Possible Mortgage eligibility requirements.

For Manually Underwritten Mortgages, the updated Borrower income limits will be effective for Mortgages with Application Received Dates on and after July 12, 2020.

See Bulletin for details of the 2020 AMI limits. 

Establishes KRS Chapter 390, Kentucky Uniform Powers of Appointment Act.

Based on Servicer feedback, at the direction of the FHFA and in alignment with Fannie Mae, we are updating certain provisions of our insurance loss settlement requirements to expedite the disbursement of insurance proceeds and streamline the inspection process. With this update, Servicers are no longer required to:

• Disburse insurance proceeds via check made payable jointly to the Borrower and the contractor
• Validate that the contractor performing the repairs is licensed or bonded and insured. These updates apply to Mortgages that were current as well as delinquent at the time of loss.
• Perform a final inspection to validate completion of repairs when the Mortgage was current at the time of loss

Additionally, to facilitate Servicer oversight of property repairs and to help overcome scheduling conflicts that may delay the disbursement of proceeds, we are introducing new requirements authorizing the completion of remote loss-settlement inspections* when the Mortgage was current at the time of loss, using Borrower-submitted photos or video or Servicer-directed video calls with the Borrower. Such “remote inspections” may be employed by the Servicer, in lieu of physical inspections, to confirm the progress or completion of repairs at the property.

*These remote inspection requirements do not extend to inspections required to confirm the status of the property after a disaster (Section 8404.2) or inspections triggered by the delinquency of the Mortgage (Section 9202.12).

See Bulletin for complete details

Eligible Disasters

• Eligible Disaster definition
• Credit reporting requirements updates for Borrowers impacted by an Eligible Disaster

COVID-19 Servicing updates and clarifications

• Additional updates to Servicer incentives for Extend Modification and Capitalization and Extension Modification
• Insurance loss proceeds disbursements to Borrowers impacted by a covid-19 related hardship
• EDR reporting clarification for Mortgages with an ongoing COVID-19 related hardship that are also impacted by an Eligible Disaster
• Clarification of Escrow shortage repayment period following a COVID-19/Disaster Payment Deferral

Fannie Mae has updated LL-2020-02 for the following:

• Disbursing insurance loss proceeds: Clarifying servicer requirements related to disbursing insurance loss proceeds for borrowers impacted by COVID-19 
• Impact of COVID-19 on Fannie Mae Home Affordable Modification Program (HAMP) ”Pay for Performance” incentives: Clarifying when a borrower on a COVID-19 related forbearance plan maintains good standing

The Servicing Guide has been updated to include changes to the following: 

▪ Loss draft updates*: simplifies our loss draft disbursement policies while managing risk. 

▪ Revisions to post-disaster credit reporting requirements*: removes instructions to suspend credit reporting for borrowers impacted by a disaster. 

▪ Payment reminder notice for mortgage loans in an active forbearance*: authorizes the servicer to not send a payment reminder notice to borrowers in an active forbearance plan. 

▪ Miscellaneous revisions*: promotes borrower awareness of our Disaster Response Network, discusses policies previously communicated regarding P&I drafting changes, and updates the servicer’s requirements when submitting a charge-off request to us. 

Fannie Mae updated LL-2020-07 to:

• update the requirements for repayment of any escrow shortage amount identified in connection with a COVID-19 payment deferral or as part of the next annual analysis; 
• clarify how servicing fees, guaranty fees, and excess servicing fees (if applicable) will be reimbursed for mortgage loans that receive a disaster payment deferral; and 
• clarify that the servicer must evaluate the borrower for a Flex Modification in accordance with the reduced eligibility criteria when the borrower becomes 60 days delinquent within six months of the COVID-19 related payment deferral’s effective date and the servicer is unable to achieve QRPC.

The Final Remittance Rule imposes requirements on entities that send international money transfers, or remittance transfers, on behalf of consumers. 

• mandates that remittance transfer providers generally must disclose the exact exchange rate, the amount of certain fees, and the amount expected to be delivered to the recipient
• allows for depository institutions to estimate certain fees and exchange rate information under certain circumstances, but by statute, this provision expires in July 2020
• allows certain banks and credit unions to continue to provide estimates of the exchange rate and certain fees under certain conditions
• increases the threshold that determines whether an entity makes remittance transfers in the normal course of its business and is subject to the Rule 
  • entities making 500 or fewer transfers annually in the current and prior calendar years would not be subject to the Rule
• further provides regulatory certainty that will continue to enable consumers to send money to their family and friends overseas during the Coronavirus pandemic and beyond

The purpose of this Circular is to clarify guidance on the calculation of statutory fee recoupment as required by Public Law 115-174, the Economic Growth, Regulatory Relief, and Consumer Protection Act (the Act), for Interest Rate Reduction Refinance Loans (IRRRLs)

Loan Product Advisor

• Effective July 24, we’re updating a message, based on your feedback, to provide more clarity in determining if a condominium loan that may be eligible for automated collateral evaluation (ACE) is relieved of project-related representations and warranties.

Effective for cases with Note Dates on or after July 28, 2020 through November 30, 2020

In addition to verifying and documenting that the income derived from self employment is stable with a reasonable expectation that it will continue, mortgagees must verify the existence of the borrower’s business within 10 calendar days prior to the date of the Note to confirm that the Borrower’s business is open and operating

See ML for documentation requirements

Modification to rental income requirements

Where a borrower is qualifying utilizing rental income, for each property generating rental income the Mortgagee must either:

1. Reduce the effective income associated with the calculation of rental income by 25%, or

2. Verify 6 months PITI reserves (this option is applicable to Forward only), or

3. Verify the borrower has received the previous 2 months rental payments as evidenced by borrower’s bank statements showing the deposit. (This option is applicable only for borrowers with a history of rental income from the property).

Effective immediately for open escrow accounts through November 30, 2020

Modification to the Approval of Extension Requests and Release of Funds under FHA 203(k) Rehabilitation Mortgage Insurance Program

FHA is providing a temporary flexibility allowing Mortgagees to continue administering the Rehabilitation Escrow Account, including the approval of extension requests and release of funds, which will allow the project to continue for mortgages where the Borrower is in forbearance due to the impacts of COVID-19. 

The COVID-19 pandemic has caused job loss, income reduction, and other issues impacting businesses and borrowers. As it continues to put a strain on the mortgage industry, Fannie Mae and Freddie Mac, under the guidance of FHFA, are working together to assist our customers and provide liquidity to the market. 

While lenders are putting in place additional due diligence to ensure borrowers have a stable income with which to repay their loans, there is an increase in loans going into forbearance after loan closing and before sale to us. This Lender Letter addresses the eligibility and delivery requirements for these loans. 

Under the guidance and direction of the FHFA and in alignment with Fannie Mae, we are extending the temporary requirements for purchase of Mortgages in forbearance announced in Bulletin 2020-12 and subsequently extended in Bulletins 2020-17 and 2020-23. These requirements are now effective for Mortgages with Note Dates on or after February 1, 2020, and on or before August 31, 2020, and Settlement Dates on or after May 1, 2020, and on or before October 31, 2020. 

Mortgage Loans secured by Properties located in Oregon, you must send the Fannie Mae Notice of Accommodations form required by Oregon HB 4204 known as the Oregon COVID-19 Borrower Relief Act (Act).

Notice of Accommodations 

The Act requires lenders to: 

• make certain relief available to Borrowers during Oregon’s COVID-19 Emergency Period (March 8, 2020 through September 20, 2020 as may be extended by law); and
• provide written notice to each Borrower of their rights to accommodations under the Act.

For any Mortgage Loan secured by a Property in Oregon, you must:

• Obtain Fannie Mae’s approval for all forbearances.
• Deliver the Notice of Accommodations mandated by the Act to the Borrower:

- per the Mortgage Loan document notice provisions;

- using the form of Notice of Accommodations attached as Exhibit A; and

- as soon as possible, but no later than August 29, 2020.

By August 31, 2020, send the Maturity Management Group at maturity_management_group@fanniemae.com

- list of all Mortgage Loans subject to the notice requirement, and

- copy of each notice sent to the Borrower.

• Retain a copy of each notice in your servicing file