Iowa State Guidelines - eprmg.net

1 iowa State Guidelines For Internal Use Only Page 1 of 6 07/09/2014 iowa Guideline s Quick Links: Licensing Wholesale Disclosures Retail Disclosures Redisclosures Closing Documents Fee Information General Requirements General loan Restrictions and Practices loan Closings Miscellaneous Second Lien Loans LICENSING Lender Licensing Any company (including a sole proprietorship) that in a calendar year makes, originates, or services at least four mortgage loans secured by owner-occupied residential real property located in iowa must have a Mortgage Banker License o PRMG has a Mortgage Banker License (Company License # 2013-0098) o PRMG can do Retail OR Wholesale with brokers who have an iowa Mortgage Banker License - Qualified Individual: There is no Qualified Requirement(QI) in iowa o Brick and Mortar: There is no brick and mortar requirement for the iowa Mortgage Banker License Branching: Any location other than the principal office that conducts iowa mortgage business with iowa residents must have a Mortgage Branch Registration.

2 The requirements are: o A branch manager who has a iowa Mortgage loan originator License o Disclosure Questions o Cost: $40 PRMG s locations that are authorized to lend in iowa : o Headquarters (Corona, CA) Broker Licensing Applies when PRMG acts as a third party originator and sends the loan to an approved wholesale lender to underwrite and fund Any company (including a sole proprietorship) that in a calendar year arranges or negotiates or attempts to arrange or negotiate at least four mortgage loans or commitments secured by owner-occupied residential real property located in iowa must have a Mortgage Broker License or Mortgage Banker License o PRMG has a Mortgage Banker License o PRMG can broker loans under its iowa Mortgage Banker License Brokers with multiple branches: Each office location of a licensed mortgage broker, other than the main office identified on the Mortgage Broker License, whether or not located in iowa , which conducts business involving iowa residential property must have a Mortgage Branch Registration Mortgage loan Originators loan Officer: An individual who for compensation or gain or in the expectation of compensation or gain, either directly or indirectly takes a residential mortgage loan application or modification application, or offers or negotiates terms of an iowa residential mortgage loan must have an iowa Mortgage loan originator License Processor/Underwriter.

3 Processors and underwriters who are retained as independent contractors are required to obtain a Mortgage loan originator License Return to Top iowa State Guidelines For Internal Use Only Page 2 of 6 07/09/2014 LICENSING CONTINUED Department Contact Superintendent, Division of Banking iowa Department of Commerce 200 East Grand Avenue, Suite 300 Des Moines, IA 50309 (515) 281-4014 Website: Return to Top WHOLESALE DISCLOSURES General Requirements Note: If you click on any blue document title below, it will take you to a sample of that document The disclosures/closing documents listed below are required in addition to applicable federal disclosures, Good Faith Estimate, Truth in Lending, etc. Broker s Initial Disclosures Disclosures that must be included with the broker s initial disclosures are as follows: loan Brokerage Agreement All loans PRMG s iowa Specific Initial Disclosures The following disclosures are available from our document vendor: Interest Reduction Fee Disclosure Only if Discount Fee is Charged Return to Top RETAIL DISCLOSURES General Requirements Note: If you click on any blue document title below, it will take you to a sample of that document The disclosures/closing documents listed below are required in addition to applicable federal disclosures, Good Faith Estimate, Truth in Lending, etc.

4 PRMG s Initial Disclosures The following disclosures are available from our document vendor: Interest Reduction Fee Disclosure Only if there is a discount fee charged Return to Top REDISCLOSURES iowa Specific Disclosures for the Redisclosure Packages There are no iowa specific redisclosures Return to Top CLOSING DOCUMENTS iowa Specific Closing Documents The following specific closing documents must be completed at closing: iowa Acknowledgment of Receipt of Copies of Signed loan Documents All loans iowa Addendum to the Note Oral Agreement Notice-All loans iowa Interest Reduction Fee Disclosure- Only if there is a discount fee charged Return to Top iowa State Guidelines For Internal Use Only Page 3 of 6 07/09/2014 FEE INFORMATION General Fee Restrictions: PRMG generally does not accept advance fees, EXCEPT for appraisals through Lender X where they are kept in a trust account until the appraiser is paid; on VA appraisals, PRMG only asks for a pre-authorization on the credit card that will ultimately be charged All fees must be disclosed in writing All fees shall not deviate from industry norms and PRMG s general policies Note: Any fees not allowed/included in the matrix below must be approved by PRMG s Legal & Compliance Department Fees Fee Name Type (Paid to) Allowed Not Allowed Requirement(s) Admin Fee Broker X Not allowed on FHA/VA Application Fee Broker X Brokers may only charge certain bona fide third party fees.

5 ( credit report fees) Appraisal Lender/Broker/ Third-Party X Must be supported by invoices Attorney Third-Party X Permissible if they are for services actually performed that were necessary to the transaction Broker Fee Broker X Wholesale: a broker may charge this fee on borrower paid; Non-Brokered Retail Loans: PRMG does not charge a Broker Fee; Brokered Retail Loans: Only permissible on borrower paid Commitment Fee X Not an approved PRMG fee Courier Third-Party X Charged by the closing agent/closing attorney Credit Report Lender (Retail)/ Broker X Must be supported by invoices; can only be charged by the broker on Wholesale and PRMG on Retail Discount Points Lender X Document Prep Fee Lender X Permissible and reasonable Escrow Fee Third-Party X Permissible if it is for services actually performed; typically included as a settlement closing fee charged by title MERS Fee X PRMG does not charge a MERS Fee Notary Fee Third-Party X Notary Discretion Origination Fee Broker X Wholesale a broker may charge this fee; PRMG does not charge this on Non-Brokered Retail loans; Brokered Out Loans it is permissible Pest Inspection Third-Party X Must be supported by an invoice **Fee Information continues on the next Return to Top iowa State Guidelines For Internal Use Only Page 4 of 6 07/09/2014 FEE INFORMATION CONTINUED Fees Fee Name Type (Paid to) Allowed Not Allowed Requirement(s) Processing Fee Lender (Retail) X Retail: It is permissible.

6 Wholesale: for lender paid it must be a third-party processor that is licensed, on borrower paid a processing fee is permissible Recording Fee Third-Party X Permissible closing cost Settlement Agent Third-Party X Permissible if it is for services actually performed; it is customary that title conducts settlement closings Survey X Surveys are not required Tax Service Lender X Title Insurance Third-Party X Must match the premium stated in the policy Underwriting Lender X Only charged by PRMG *RESPA prohibits lenders from charging fees specifically for preparation of the HUD-1/HUD-1 settlement statement or TILA disclosures Return to Top GENERAL REQUIREMENTS Tangible Net Benefit (TNB) Requirement iowa does not have any TNB requirements Copies of loan Documents Upon written request, lenders must provide copies of all documents in the borrower s loan file to the borrower Return to Top GENERAL loan RESTRICTIONS AND PRACTICES Advertising Advertisements or solicitations include business cards and websites PRMG s NMLS ID 75243 must also be on all advertisements NMLS unique identifier must be displayed on all documents.

7 Solicitations, advertisements, business cards or web site Depository institutions and mortgage companies are not allowed from attempting or permitting a real estate or insurance subsidiary to attempt to create the impression in their advertising or in any communication that their customers have priority access to the funds or preferential interest rates or other terms Mortgage loan originators are prohibited from soliciting or advertising for specific interest rates, points, or other financing terms, unless the terms are actually available at the time of soliciting or advertising General Restrictions It is unlawful for any person or entity engaged in real estate related transactions to discriminate against any person in making available such a transaction, or in the terms or conditions of such transaction, because of.

8 Age, race, color, religion, sex, disability, familial status, marital status, sexual orientation, or national origin A Lender financing mortgage loans may not condition the loan on the borrower s use of a particular insurance company, agent, or broker (does not limit a lender from having to approve the use of certain insurance companies based on reasonable criteria) Lenders may not require insurance beyond the value of the building(s) located on the property A lender may not charge a borrower a separate or additional fee for allowing the borrower to use their own insurance policy that was provided through an insurer licensed to do business in iowa Return to Top iowa State Guidelines For Internal Use Only Page 5 of 6 07/09/2014 GENERAL loan RESTRICTIONS AND PRACTICES CONTINUED Predatory Lending Laws PRMG does not make loans that exceed the points and fees or other limitations of any local, State , or federal predatory lending law Prepayment Penalties PRMG does not offer programs with prepayment penalties If a prepayment penalty where charged, it must be conspicuously stated in the note Higher Priced Mortgage loan (HPML)

9 PRMG does not offer higher priced mortgage loans except for what is provided here Reverse Mortgages PRMG does not offer Reverse Mortgage Programs on Wholesale, but is allowed to broker them out on Retail No Doc/Limited Doc Programs PRMG does not offer no doc or limited doc programs in iowa Return to Top loan CLOSINGS Security Instrument/Document Execution iowa is a mortgage State Trustee requirements are not applicable in iowa since it is a mortgage State Witness Requirements: Witnesses are not required, but allowed when: the grantor dies before making the acknowledgement, if the grantor s appearance is unattainable, or if the grantor appears and refuses to acknowledge the execution of the instrument Closing Practices iowa is a wet funding State iowa is not attorney State iowa law does not expressly require that attorneys prepare loan documents Property Taxes Doc drawers and funders must confirm the property tax amounts and due dates for the city, town , county where the subject property is located as they vary depending on the county Property taxes in iowa are mailed out annually and may be paid in one installment or two installments o The first half is due September 1 and becomes delinquent after September 30 o The second half is due March 1 and becomes delinquent after March 30 Marital Rights iowa is not a community property State Homestead.

10 Homestead rights exist and the non-title spouse s signature is required on refinance transactions and the non-title spouse should execute the TIL, Mortgage, and Notice of Right of Rescission (If applicable) Return to Top MISCELLANEOUS Record Retention iowa requires that records be maintained for at least 25 months from the date of the final transaction with the borrower PRMG has a current retention policy of 5 years for both advertisements and loan documents Late Charges iowa does not regulate the amount of late charge; thus, the maximum allowable late charge is 5% on Conventional and 4% on FHA/VA/USDA Payoff Statements A payoff statement with the daily interest must be provided to the borrower within ten (10) days of the borrowers written request Return to Top iowa State Guidelines For Internal Use Only Page 6 of 6 07/09/2014 MISCELLANEOUS CONTINUED Payoffs Within 45 days from the date of satisfaction of a residential loan , the lender must record a satisfaction of mortgage Failure to record after 15 days could result in penalties ranging from $50 per each day of delinquency A servicer must acknowledge and record a written release when the mortgage loan is paid off.