Closing Docs Process

File Prep

Verify key info with the Loan Officer, Loan Officer Assistant and Processor

1. Verify the date the borrower will be signing

2. Verify the date the loan should fund

3. Verify the borrower(s) desired vesting

4. Verify if there is a Re-Inspection we don't have an Invoice for yet

5. Verify the contact information for Escrow/Title

Review milestone comments for important information.

Confirm that all title and escrow/settlement agents and their companies are vetted

1. The entry in the File Contacts must include:

   1. Full office address

   2. Agent name

   3. Phone number

   4. Email address

   5. Title/escrow case number

1. Navigate to the Secure Insight website (https://lender.secureinsight.com/) and ensure they are listed as Low Risk for Risk Rating

Verify if the borrower is using a Down Payment Assistance (DPA) program and if we have the DPA Closing Docs

1. If the loan program name contains the phase Down Payment Assistance (DPA), there’s subordinate financing

2. If the Combined Loan to Value (CLTV) is greater than the Loan to Value (LTV), there’s subordinate financing

3. Check the Verification of Additional Loans (VOAL) screen, if there is a line item, there’s subordinate financing

4. Separate docs will need to be pulled if using a DPA

Review and clear open Alerts

1. Review Alerts in the Alerts & Messages section. Start an email to condition/notify the appropriate party (i.e. underwriter, processor, Loan Officer) to clear Alerts:

   1. Loan Officer to review

      1. Lock expires

   2. Underwriter to review

      1. AUS Data Discrepancy Alert

      2. Income: Paystubs expired

      3. Title Report expired

      4. Underwriting Fannie Mae DU expired

      5. Underwriting Freddie Mac Loan Product Advisor expired

      6. UW Docs Alert

   3. Closing Docs Drawer to review

      1. Closing Date Violation

      2. Compliance Review – Review after reviewing fees

      3. Disclosure Validation

      4. Good Faith Fee Variance Violated – Review fees before issuing a Lender Credit for a Cost to Cure. If one is needed the cure amount, date and reason for the cure must noted in the Good Faith Fee Variance Resolution box.

         1. Add cure to 1003 URLA – Lender

         2. Make sure everything transferred over to page 1 of the CD and mark “tolerance cure”

Quality Control

Credit Refresh / Loan Quality Initiative (LQI)

• This document is located in the LQI Report bucket/placeholder in the eFolder

• Review and confirm Date Completed is within 10 days of the Note date.

• Check the Received date in the bucket/placeholder. These dates should match to properly generate the expiration date.

Closing Protection Letter

• This document is located in the Title Closing Protection Letter bucket/placeholder in the eFolder

• The Date must be within 30 days of the Note date

• Check the Received date in the bucket/placeholder. This date should match the date on the CPL to properly generate the expiration date.

• Verify borrower’s name matches

• Verify the property address matches

• Verify the loan number matches

• Review the mortgagee and confirm it references the DBA/brand

  • Alterra:
  • Americana:

SSA-89

• This document is located in the SSA-89 Social Security Number Verification bucket/placeholder in the eFolder

• Verify this form is in the eFolder and wet-signed

Underwriting Conditions

• Locate the Underwriting Conditions tab in the eFolder

• Sort by Status then Prior To

• Click Status to have all Added conditions at the top

• Review any Prior to Closing and Prior to Docs conditons that have a Status of Added and owner is marked as “CL” aka Closer

Verbal Verification of Employment (VVOE)

• This document is located in the Income VOE Verbal bucket/placeholder in the eFolder

• Confirm VVOEs are dated less than 10 days prior to the Note date for ALL borrowers

• If the borrower is self-employed‐ confirm CPA letter/S.E. documents are dated less than 10 days prior to the Note date for ALL borrowers

• If using the Work Number, reference the “CURRENT AS OF” date not the Verified On date

Initial Closing Disclosure (ICD)/Loan Estimate (LE) review

• The ICD must be sent & signed 3 business days prior to the Note date

• Confirm all key information (see below) still matches. If it does not, review to see if a Change of Circumstance is needed.

  • Loan Term

  • Purpose

  • Product

  • Loan Type – Note: FNBA ITIN loans will show Conventional

  • Loan Amount

  • Interest Rate

• The Rate Lock Agreement disclosure must have already been sent to the borrower

USPS

• This document is located in the Property USPS bucket/placeholder in the eFolder

• Confirm the full property address is entered correctly in Encompass

• County Name must match Encompass

Lock Expiration

• The lock must not expire before the good through funding date

• If the lock expiration date is close to expiring, email the LO to get it extended

• If the cost for the rate lock extension is added on the buyer side, a COC must go out with closing docs

Property Type

• Must always match what appraisal says

• If it’s marked as a Planned Unit Development (PUD) or Condo on the Appraisal Report, Encompass must reflect the same to generate the correct Rider for your Deed of Trust (DOT)

• If property is a Manufactured Home:

  • Page 2 of the Deed of Trust might need the “Condominium Rider” checkbox unchecked

  • Manufactured Home Rider and Manufactured Affixation needs to be emailed to Cindy Georgette for Lender Signature and Notarization

FHA Case Number

• This document is located in the FHA Case # bucket/placeholder in the eFolder

• The case number must be input in the FHA Management screen and include the two dashes and ADP code

• If the Case is pulled after application, transfer docs are required

Homeowners Insurance

• This document is located in the Property Homeowner Insurance bucket/placeholder in the eFolder

• Information on the Homeowners Insurance Policy must match Encompass:

  • Borrower’s name

  • Subject property address

  • Loan number

  • Mortgagee

• If the property requires Flood Insurance, the same info must match

• Dwelling Coverage/Coverage A/Replacement Cost Estimator must be equal to or greater than the loan amount

• The annual insurance premium (divided by 12 months) must match the monthly payment in Encompass

Property taxes

• This document is located in the Tax Bill bucket/placeholder in the eFolder

• Ensure the monthly amount matches the Tax Cert./Prelim/Title Report

Mortgage Insurance (MI)/VA Funding Fee/USDA Guarantee Fee

• Verify the MI premium is correct.

  • FHA – Click the “Get MI” button in the Proposed Monthly Payment section.

  • VA – The VA Funding Fee is determined using the Certificate of Eligibility (COE) and the VA’s Funding Fee Chart.

  • CONV – Only required if the Loan to Value (LTV) is at or above 80%. Compare the factor against the MI Quote in the eFolder.

  • ITIN with FNBA – Does not require MI

  • 2nd Lien Position files - Does not require MI

Borrower Information - Vesting

• The branch should have completed the Vesting/Manner in which Title will be held. If it is not complete in Encompass, review the Milestone Comments/emails/etc.

• Double click each individual buyer and ensure all AKAs from the credit report are input. Note: separate each AKA by inserting a semicolon

Power of Attorney (POA)

• For borrowers using a POA, ensure the POA Borrower and POA Signatured Text are complete before clicking the “Build Final Vesting” button

Trust

• For borrowers using a trust:

  • Enter trust type

  • Add trust date/year

  • Enter beneficiary info

  • Click “Print Trust Name(s) on LE/CD Addendum”

• Add vesting type, occupancy status, occupancy intent, trustee of and vesting

Texas Properties

• For all loans on properties located in Texas, you must enter the “trustee”

• Click the magnifying glass then select “Allan B. Polunsky”

Docs Prepared By

• Search and select Panorama Mortgage Group

Property Information

• Condo/PUD Name – Match the name in Legal Description of Preliminary Title Report

• Parcel Number (Note: some new construction might not have one)

• Title Report Date

• Approved Items (do not include numbers of line items that have a lien)

• Tax Message = To be paid

• Special Endorsements:

  • If in Texas enter in T-19

  • If in Nevada:

    • 100 (newly modified) or 9.10 in lieu of the 100, Alta 9, 8.1, 22‐06

    • Water rights – 103.5/ALTA 41.1

    • Condo – 116/ALTA 22‐06

  • Standard for all states except Nevada:

    • 100, 116, 8.1 ALTA 9

  • Additionally:

    • SFR/Duplex – ALTA 9

    • PUD – 5.1

    • Condo – 116.2 OR ALTA 4 OR 115.1

    • Manufactured home – ALTA7

    • NEG – AM ARM – 6.02

    • ARM – 111.5

    • Balloon – 111.9

    • Water Rights – 103.5

    • Corporate Assignment – 104.1

• Click the "Attach legal description" checkbox

• Manufactured - enter all info to match appraisal

2015 Itemization vs the Title Draft CD/Estimated Settlement Statement

Invoices

1. Ensure the Payee matches Encompass

2. This is the only screen you are allowed to click the Lock icon and override fees. Often times, an annual fee is divided into monthly payments for qualifying. This can result in the invoiced total being off by a few cents. If we have to pay a total fee upfront, total amount must be accurate.

800. Items Payable in Connection with Loan

1. Loan Origination Fees – These should match the amount on the last LE.

   1. ITIN w/ FNBA = Should be 3%

2. Processing Fees – These should match the amount on the last LE.

3. Underwriting Fees - These should match the amount on the last LE.

4. Document Preparation Fees - These should match the amount on the last LE.

1. Origination Points (Discount Points) - Make sure the Bona Fide box is checked.

1. Verify the Origination Points/Discount Points % matches the Rate Sheet document.

   1. DPAs - Will not have a Rate Sheet

   2. ITINs with FNBA – They issue a “Mortgage Loan Commitment to Purchase.” You DO NOT need to complete this step for these loans.

   3. Line 802e Origination/Discount Point – This number will equal 100 minus the Price on the Rate Sheet. Example … 100 – 96.838 = 3.162

1. Appraisal Fee – The Invoice should be in the “Invoices” bucket/placeholder. Verify the amount on the Invoice and whether it has been paid already. Open the Fee Details icon next to the Appraisal Fee in Encompass, make sure the total amount matches the total cost and make sure the (POC) Paid Outside of Closing amount matches the amount already paid. Also, make sure the Payee matches. In the example below, Suntender Valuations, Inc. is the Payee.

1. The amount in Encompass should match the Invoice for these fees:

   1. Credit Report

   2. Verification of Employment

   3. Condo Desk Review Fee

   4. Condo Certification Fee

   5. Reinspection Fee

2. Do not change the amount of these fees:

   1. Tax Service

   2. Flood Certification

   3. Attorney’s Fee – Texas only

   4. Compliance Review Fee

   5. Recording Fee and Transfer Tax

900. Items Required by Lender to be Paid in Advance

1. Daily Interest Charges

   1. Make sure this is a positive number. If it’s not, the Est. Closing Date needs to be updated.

2. Mortgage Insurance Premium

   1. Only required for FHA loans (payee is Department of Housing & Urban Development) and Conventional loan in which the borrower selects to pay the MI up front.

3. Homeowner’s Insurance (HOI)

   1. Make sure the annual premium on the HOI Invoice is the same as Encompass. If already paid, mark as Paid Outside of Closing (POC).

4. Property Taxes

   1. If property taxes are due and payable within 60 days of closing, these must be collected upfront.

5. VA Funding Fee

   1. Only required if it’s a VA loan and the borrower is not exempt from the VA Funding Fee per the Certificate of Eligibility (COE). The payee is Department of Veterans Affairs.

6. Flood Insurance

   1. If the property is in a Flood Zone and requires Flood Insurance, make sure the annual premium on the Invoice is the same as Encompass. If already paid, mark as Paid Outside of Closing (POC).

1000. Reserves Deposited with Lender

1. Aggregate Setup

   1. Cushion - Every state except Nevada should have 2 months of Cushion for Property Taxes and Hazard Insurance

   2. Property Tax Due Dates – Reference Tax Cert. or Preliminary Title Report for the upcoming due dates

   3. Hazard Insurance - This date should reflect the date after the Expiration Date on the Homeowner’s Insurance Policy Example:

      

      
   4. Mortgage Insurance – If the loan requires MI, there needs to be 12 “1’s” starting with the first month after closing

      1. FHA – Will always have MI

      2. Conventional – Only required if LTV is above 80%

      3. USDA – enter 12 1’s under the “annual fee” line with 2 months cushion

2. Make sure all Paid To boxes show “O” (paid to Other)

1100. Title Charges

1. All title fees should match the Estimated Settlement Statement/Title Draft CD from Escrow/Title/Settlement Company. If you run out of lines, place the additional fees in Section 1302-1309 (which are indicated with a single asterisk).

2. Any Prorations should also be entered in Closing Disclosure Page 3

3. Review the Purchase Contract for the items below. These should also be entered in Closing Disclosure Page 3.

   1. Earned Money Deposit (EMD)

   2. Seller Paid Fees

4. Compare the settlement company listed on the Settlement Service Provider List (SSPL) initial disclose to the company on the Estimated Settlement Statement/Title Draft CD from Escrow/Title/Settlement Company. If the company name and address are different, place a check in the Borrower Did Shop box next to each fee in Encompass.

1200. Recording Fees

1. Fees must match the Estimated Settlement Statement/Title Draft CD from Escrow/Title/Settlement Company

1300. Additional Settlement Charges

1. All “section H” fees per title fee sheet to be entered towards the bottom with the (**)

2. All fees should be marked as “O” for other here as well

1400. Total Estimated Settlement Charges

1. If there are any Lender Credits, verify there is written/email approval from management.

2. Verify any Seller Credit input matches the Purchase Contract. Also, verify the amount of Interested Party Contribution (IPC) does not exceed the program maximum (see chart)

Arizona:

Mavent Report/Compliance Review

Click the Preview button in the top right

• Click the Fee Details button

  • Any red fees need the APR box to be checked/unchecked in the 2015 itemization screen

• Review for Alerts, Warnings or Fails

  • If any of these Alerts show, check the RateSheet in the eFolder and find the “Waive Escrows” info. If this says “No” we are okay to proceed without clearing these Alerts.

  • If ITIN with FNBA, it doesn’t have to pass the QM Points and Fees Limit

    

    
  • If the Loan Program is FHA, it does not have to pass this test:

    
  • If this Warning appears, you can ignore them and keep going

    

    

QM Points and Fees Test

The % in the “Total points and fees applicable under section 32” should be lower than the % above it in the “Current Qualified Mortgage Fee Thresholder” field. If it’s not, notify your manager.

Closing Disclosures Page 1

1. Review the Disclosure Information section to see if a Change of Circumstance (COC) needs to be sent out with the Closing Docs

2. File # = Preliminary Title Report/Order/File Number

1. Make sure both "Customize" boxes are NOT checked

Closing Disclosure Page 2

1. Fees should be marked paid “Before Closing” only if we have an Invoice showing the fee has already been paid

Closing Disclosure Page 3

1. See details in

   1. For Purchases, update the drop-down to show "Section K and Section L"

1. Payoffs & Payments

   1. Any accounts being paid off must have a Payoff Statement, Account Printout or Credit Supplement.

   2. Amounts must match between the document and Encompass.

   3. If you have payoffs for a purchase and your top/bottom amounts don’t match – copy your payoff amount, click the pen and paper then add under “Non‐UCD”

1. The Cash to Close total and the Cash From/To Borrower must match

Closing Disclosure Page 4

Assumption

1. For FHA and VA loans, the “will allow, under certain conditions, this person to assume this loan on the original terms” checkbox should be checked. For Conventional, check the other box.

1. Check the “does not have a demand feature” checkbox and the “Get Late Fee” button.

1. The “do not have a negative amortization feature” and “does not accept any partial payments” boxes should be checked.

Closing Disclosure Page 5

1. Other Disclosures – Check “state law may protect you from liability for the unpaid balance”

2. In the “Lender” section click the “Copy from 1003” button

1. For Purchases, the Real Estate Broker (Buyer/Seller) should have all fields except the NMLS field completed (if not, navigate to the File Contacts and click “Add to CD Contact Info”)

1. Settlement Agent should be completed with license numbers (if not, navigate to the File Contacts and click “Add to CD Contact Info”)

Send the Closing Docs

Navigate to the RegZ – CD screen.

1. Click the Plan Code button and choose the top option in the pop-up window.

1. Signing/Note Date

   1. The fields below should all reflect the date the borrower will be signing:

      1. CD Date Issued

      2. Document Date

      3. Closing Date

      4. Doc Signing Date

   2. The fields below should all reflect the date the loan will be funded:

      1. Disbursement Date

   3. Confirm your MERS MIN # has populated (excludes ITIN loans)

   4. Confirm your first payment date is correct

1. Generate the Closing Docs

   1. Click the Order Docs button

      
   2. If you get any of these pop-ups, click OK and close them

      

      
   3. Make sure the “Order Type” says “Closing” and click the “Order Docs” button

      
   4. Add Additional Documents

      
   5. Click the “Add eFolder Files” radio button and select “All” from the “For Borrower Pair” drop-down

      
   6. Select all the buckets/placeholders below. Note, some files might not have some from the list:

      1. Assets: Gift Letters

      2. Closing Invoices

      3. DPA docs (if applicable)

      4. Homeowners Insurance

      5. Invoices

      6. Payoff Statements

      7. Property: Flood Insurance

      8. Property: Sales Contract

      9. Property: Homeowner’s Insurance Policy

      10. Purchase: Purchase Contract

      11. To be signed

   7. Click the “Add” button

   8. Click the “Send” button

   9. Click Send, click “Send through Simple Nexus,” select the Escrow contact, click the “Traditional” radio button and click Send.

      

      

Send email notify Escrow/Settlement Company that Closing Docs have been sent.

Mark the Finished checkbox in the Doc Prep milestone worksheet.

Assign the Funder.