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RESPA and Escrow Analysis Training Guide
The Rules Have Changed Again.  Can you believe it?

 

Learn Title Searching

 Learn to conduct a title search with this online training class.  

 

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 Cushions, Aggregate Analysis, Higher Priced Mortgage Loans, GFE, HUD1

UPDATED OCT 2009 (Includes Higher Priced Mortgages Rule requiring escrow accounts  new HUD1, and new GFE)

 

Escrow Analysis Training by Linda Chandler
 
 
Although the Real Estate Settlement Procedures Act was enacted in 1974, Section 10 relating to escrow accounts, was not interpreted until HUD issued the Final Rule effective October 1, 1995. 
The Final Rule required major changes in the way accounts were analyzed.  It required training or
re-training on escrow analysis, system changes, a review of state laws and a review of the mortgage documents to see if cushions were allowed. Indeed there were drastic changes to the
established method of conducting an escrow analysis.
 

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Compliance
Mortgage servicers managed to work all this out and bring their company into compliance.  Training was provided for  employees, systems were changed, overages were refunded as needed, and eventually everyone became accustomed to aggregate analysis.  Aggregate analysis adds the disbursements together and divides the total by 12 to arrive at the monthly escrow amount needed. 
 
Training
Although the staff became accustomed to aggregate analysis, new employees still had to start at
the beginning and learn about escrow accounts - why do we maintain an escrow account, what
is included in an escrow account, and the requirements of HUD's Final Rule.  Terms such as cushions, shortages, deficiencies, overages, fall to zero, aggregate analysis, initial disclosure statement, and many more are complicated terms for new employees.  Our Escrow Analysis
Training Guide was written with that thought in mind.
 
 
Higher-priced mortgage loan” rules go into effect Oct. 1  
 Reg. Z designates “higher-priced mortgage loans” as closed-end mortgage loans that are secured by the borrower’s principal home (including home purchase loans, refinancing of loans and home equity loans) with an APR greater than the average prime offer rate on a comparable transaction by at least 1.5 percentage points for first lien loans or 3.5 percentage points for subordinate lien loans.
 
The escrow requirements effective date is April 1, 2010 for site-built homes and October 1, 2010 for manufactured homes. Lenders cannot make higher-priced mortgage loans without regard to the consumer’s repayment ability at the time the loan is made.  Lenders must verify the borrower’s assets or income that it relies on for repayment and the consumer’s current obligations.
 
·       Prepayment penalties are prohibited if the payments on a higher-priced mortgage loan can change during the first four years after the loan is made. Even if payments cannot change, a prepayment penalty may only be assessed for two years after the loan is made, as long as the penalty is permitted by other applicable law.
 
·      Lenders cannot make higher-priced mortgage loans secured by a first lien without an escrow account for property taxes and homeowners insurance.   
         
He   Benefits of the Escrow Analysis Training Guide
  • The manual is ready to use for conducting a training class
  • Students may read through the manual on their own and work on the sample 
  •  accounts provided.
  • Saves valuable time in preparing training material                                                                                                                        
  • Provides confidence to employees as they learn and begin to understand aggregate analysis                                                                                                                                          
  • Employees will perform better and be more comfortable talking with customers as they gain a better understanding of escrow analysis.
  • Employees can use it at their desk as reference material.
  • Employees can learn the background to the Final Rule and learn about RESPA

Included in the Manual                                                                

  1. Background information                                 
  2. RESPA Requirements - HUD's Final Rule
  3. Escrow Shortage
  4. Escrow Deficiency
  5. Escrow Surplus                                                                                                
  6. Initial, Annual, and Final Escrow Analysis and Disclosure Statements
  7. Short Year Statement
  8. Limits on Escrow Accounts - Cushions
  9. Examples of Accounts
  10. Exercises for students with questions at the end             
  11. What's included in an escrow account

 RESPA requirements and HUD's Final Rule for escrow analysis are not new, however, there is always a need for training. 

 Order download and store on your computer or print as many copies as you want.  Item Number

 CLICK HERE TO PURCHASE    

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