Thursday, January 10, 2008

Uniform Closing Instructions - Part Deux

How does the UCI affect signing agents? Well, it's not easy to say right now. Many of the items covered in the instructions are things that are already covered in other places, such as Reg. Z, but aren't always implemented properly. For example, every person that signs the RTC must be given two copies of the RTC (2 signers, 4 copies total). Also, any document that refers to an attachment, legal description, or rider must have the corresponding document attached. Nothing new there, but we've all seen it done improperly.

Here's what I see so far that affects us:

Loan documents and lender contact information must be presented to the borrower one business day before the signing. No docs one day in advance, no signing. (One of my lenders already does this. All issues are resolved prior to signing so the signings run smoothly 99% of the time)

A copy of the borrower's government issued picture I.D. must be obtained. Borrower must also sign the Borrower's Certification. (Hmm, no more credible witness?)

Borrower must sign the TIL (Truth In Lending) before signing the Note or any other documents. (Most experienced signing agents already have the borrower review the TIL before any documents are signed)

Each lender will designate a fraud prevention contact. Any suspicion of unfair, deceptive, misleading or unlawful behavior by any lender or mortgage broker employee can be reported to this contact.

If a mortgage broker attends the signing, they are directed not to overtly pressure borrower to sign, encourage borrower to sign before reading the loan documents, or suggest that the borrower use the three day RTC to read the documents to address any concerns raised at the signing.

The instructions make it clear that it is not their purpose to broaden liability of the signing agent. The signing agent must follow all laws regarding UPL (unauthorized practice of law), and in the case where a signing agent suspects fraud or misrepresentation and reports their suspicions to the fraud contact, the lender indemnifies the signing agent from any legal claims.

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