NYCB Gemstone Closing
NYCB Gemstone Closing
Overview
It
b i
d t d
Items being covered today:
• Closing Disclosure Overview
• Gemstone Process Flow
• Walkthroughs of the new modules in Gemstone
The intention of this training presentation is to cover the process
fl
i hi G
I d
h
id
ifi fi ld l
l
flow within Gemstone. In depth guidance on specific field level
behavior in Gemstone will be provided in a reference document.
PLEASE NOTE W
ill
th t
“L
E ti
t ”
d it’
PLEASE NOTE: We will use the term “Loan Estimate”, and it’s
acronym “LE”, as well as the term “Closing Disclosure and it’s
acronym “CD” interchangeably throughout this presentation.
Closing Disclosure
Closing Disclosure
Background
Th D dd F k W ll St t R f A t (“D dd F k”) h d th C
• The Dodd-Frank Wall Street Reform Act (“Dodd-Frank”) charged the Consumer Financial Protection Bureau (CFPB) with integrating the mortgage lending rules applied under the Real Estate Settlement Procedures Act (RESPA) and the Truth in Lending Act (TILA). The final rule finalizes the RESPA-TILA combined forms, associated rules, and requires that lenders implement these changes by , , q p g y October 3, 2015.
• The final rule applies to most closed-end consumer mortgages. It does not apply to home-equity lines of credit and reverse mortgages, mortgages secured by
bil h d dit h k fi f t
mobile homes, and creditors who make five or fewer mortgages a year.
• The primary result of the new rule is the formal establishment of new RESPA-TILA forms that must be provided to consumers at application and closing:
– The Loan Estimate – The Closing Disclosure
Eff ti D t Th fi l l fi li th RESPA TILA bi d f d
• Effective Date: The final rule finalizes the RESPA-TILA combined forms and
associated rules and requires that lenders have implemented these changes by
The Closing Disclosure
• The final rule requires the use of the “Closing Disclosure”
which will replace the “HUD-1/1A Settlement Statement” and
the “final TIL” disclosure required under RESPA and TILA.
• The
Closing Disclosure
combines the HUD-1 and the Final
TIL into one disclosure
The Closing Disclosure
• For loans that require a Loan Estimate and that proceed
to closing, the creditor must provide a Closing
Disclosure
Disclosure.
• The Closing Disclosure must be provided three business
The Closing Disclosure must be provided three business
days before consummation of the loan.
• If the terms or costs of the transaction change prior to
the consummation of the loan, an updated disclosure
must be provided
Consummation
• Consummation of a loan occurs when the consumer
becomes contractually obligated for a loan.
• This will differ from state to state given that each state
defines when the consumer becomes contractually
obligated differently.
• Consummation may commonly occur at the same time
Consummation may commonly occur at the same time
as the closing or settlement, but it is a legally distinct
event.
• NYCB’s trigger for imposing the Closing Disclosure wait
period is the proposed closing date.
Responsibility to Provide the Closing Disclosure
• The Closing Disclosure must be provided either by the
creditor or the settlement agent.
• However, since the creditor retains ultimate responsibility
d li bilit NYCB M t
ill
t
d
and liability, NYCB Mortgage will generate and ensure
that the Closing Disclosure is provided to the consumer
in accordance with the rule.
• For purchase transactions, the settlement agent is
ibl f
idi
th Cl i
Di l
t th
responsible for providing the Closing Disclosure to the
Seller(s).
LE Waiting Periods Before Consummation
Initial Loan Estimate
• After the initial NYCB Loan Estimate is delivered to the
• After the initial NYCB Loan Estimate is delivered to the
consumer there will be a 7 business day waiting period before
the loan can be closed (presuming you have delivered a Closing
Disclosure and met all applicable wait periods)
Disclosure and met all applicable wait periods).
Revised Loan Estimate
• The loan cannot close until the fourth business day after a
revised NYCB Loan Estimate is received by the consumer
revised NYCB Loan Estimate is received by the consumer.
CD Waiting Periods Before Consummation
Cl i Di l
Closing Disclosure
• The NYCB CD must be received by the consumer no later than 3 business days before consummation of the loan.
Revised Closing Disclosure
• If one of the following occurs after delivery of the NYCB CD and before consummation, NYCB will provide a revised CD containing all changed terms and impose a new 3 business day wait period before consummation:
day wait period before consummation:
o The APR increases by more than .125% (.250% for irregular transactions). Please note an Adjustable Rate Mortgage is NOT considered an irregular transaction. A decrease in APR will not require 3-day review if it is based on changes to the interest rate or other fees.
o Loan product change (such as a switch from fixed rate to adjustable rate).p g ( j ) o Addition of a prepayment penalty to the loan.
• If changes are made that do not fall into the three categories above, no additional waiting period is required. However, NYCB will ensure that the consumer receives the revised CD at or before consummation.
o The revised NYCB CD must remain within the baseline tolerances as established by the final Loan Estimate.
Gemstone Process Flow
Gemstone Process Flow
Closing Fees & Request Docs Modules
The new Closing Fees Module and the Request Docs Module can be completed once the The new Closing Fees Module and the Request Docs Module can be completed once the following have occurred:
• The underwriting disposition is Approved with PTCs
Th G t A i l h b d d ( PIW h b i d i AU)
• The Gemstone Appraisal has been ordered (or a PIW has been received in AU) • The loan is locked
• The Flood Cert has been ordered • MI has been received (if applicable)
PLEASE NOTE: The Closing Fees Module must be completed first before Request Docs can be submitted.
Closing Disclosure Module-
SAVE ONLY
The Closing Disclosure Module can be completed and
SAVED
when
the following conditions have been met:
The underwriting disposition is Approved with PTCs • The underwriting disposition is Approved with PTCs • The Fees module has been saved
• Request Docs have been submitted
• There are no Mavent or QM Failure messages in the View Docs module
PLEASE NOTE: Saving the Closing Disclosure module will
NOT
result
in the creation of the NYCB CD, and the NYCB CD will not be sent to
the consumer.
Closing Disclosure Module-
SUBMISSION
The Closing Disclosure Module can be completed and
SUBMITTED
, resulting in creation of the NYCB CD that is then
sent to the consumer when the following conditions have been
g
met:
• The underwriting disposition is
Approved
Th F
d l h
b
d
• The Fees module has been saved
• Request Docs have been submitted
• There are no Mavent or QM Failure messages in the View Docs
module
Pre Closing Review
A loan cannot Close and Fund until completing the Pre Closing Review (even if all other requirements and waiting periods have been met).
Once the CD has been created and sent to the consumer, the Client must initiate the Pre-Closing Review. Ideally the Pre Closing Review will be completed during the 3 business day review period that occurs after the consumer has received the NYCB CD, adding no additional delay before closing.
The Client must upload the following documentation to initiate the Pre-Closing Review:
• Intent to Proceed Documentation (Example: Email or letter from the Borrower(s), Loan Officer, or Staff notes regarding a conversation with the Borrowers that instructed the Loan Originator to proceed with the loan.
• MLO Compensation Election Form • Hazard Insurance
• Hazard Insurance
• Flood Insurance (if applicable)
• Signed Ohio Notice of Change in Mortgage Terms (if applicable) • Proof of current tax payment
The Pre-Closing Review will consist of a review of the above documents as well as a review of Real Estate Tax Set-g Up and Escrows set-up in Request Docs (if applicable).
Closing/Funding
• The NYCB CD and an ‘Addendum to the Closing Disclosure’ document will be • The NYCB CD and an Addendum to the Closing Disclosure document will be
included in the Gemstone Closing Docs package. All consumers must sign the NYCB CD and the Addendum to the Closing Disclosure at closing.
• On rescindable transactions each consumer that has the right to rescind mustOn rescindable transactions, each consumer that has the right to rescind must sign the NYCB CD at closing.
• On purchase transactions, NYCB will not generate the Seller’s CD from
Gemstone. The Settlement Agent is responsible for generating the Seller’s CD Gemstone. The Settlement Agent is responsible for generating the Seller s CD and providing it to the Seller.
• The Seller’s CD, signed and dated by all Sellers at closing, must be uploaded to NYCB as part of the Complete Closing Package.
CD Certification
Within 10 calendar days of the loan Funding the Settlement Agent must enter Within 10 calendar days of the loan Funding, the Settlement Agent must enter Gemstone and Certify the accuracy of the NYCB CD.
Any post-closing changes must be made to the NYCB CD prior to Certification.
• The Settlement Agent has the ability to make minor updates themselves in Gemstone prior to Certification.
• The Settlement Agent must ask NYCB to make more significant updates, which if approved, ill b d b NYCB i t C tifi ti
will be made by NYCB prior to Certification.
• A revised NYCB CD will be generated and sent to the consumer if any post closing changes are made.
New Closing Fees Module
New Closing Fees Module
New Closing Fees Module
• For loans Registered on or after 10/03/15, the current Request Docs
Fee Screen will be removed.
I t d th
ill b
t d l
li k f
th F
• Instead, there will be a stand-alone link for the Fee screen on
Gemstone.
• Both NYCB Clients and Settlement Agents will have access to the
Both NYCB Clients and Settlement Agents will have access to the
Closing Fees Module (the Settlement Agent must be selected in the
Request Docs module to gain access).
New Closing Fees Module
The new Closing Fees module will allow for fees to be input into categories according to the The new Closing Fees module will allow for fees to be input into categories according to the alphabetical format of the CD, as opposed to the current HUD Line structure.
New Closing Fees Module – Edits to Fee $ Amts
Th Cl i F d l ill t ti ll fill ith th F f th NYCB L
The new Closing Fees module will automatically pre-fill with the Fees from the NYCB Loan Estimate Module.
The Closing Fees module will allow clients to make the following updates: • Input Payees for the Fees
• Update the “Paid To” selection (Borrower, Lender, Seller) • Update fee amounts if Change Circumstances have occurred*
• Add Fees*
D l t F *
• Delete Fees*
*These actions must be carefully considered. Errors made in performing these actions can lead to Tolerance violations and the need to apply tolerance cures. The following slides will detail the risks associated with these actions.
NOTE: Ensure that duplicate fees for the same service are not being charged to the
consumer (example: Both the lienholder and settlement agent charging a lien release fee covering the same lien).
Updating Fee Amounts
U d ti F A t
Updating Fee Amounts
• Updating Fees amounts from what has automatically carried over from the most recently disclosed NYCB LE will cause the new higher/lower fee amount to be disclosed to the borrower on the Closing Disclosure
disclosed to the borrower on the Closing Disclosure.
For Fees that are held to tolerances, and that are updated from the most recently disclosed NYCB LE:
• If the new Fee amount is higher, and is not a result of a valid change
circumstance disclosed within 3 business days of the change circumstance, this could potentially result in a tolerance violation requiring a tolerance cure.
• If the new Fee amount is lower, then this will reset the baseline from the Loan Estimate once the CD has been disclosed to the borrower. Future changes to the Fee will have a tolerance limit based on the new Fee amount. If this
lowering was done in error, and it needs to be re-disclosed at the correct higher t thi t ti ll t t l i l ti
amount, this can potentially create a tolerance violation.
→ Therefore, be very careful when lowering Fee amounts from what carried over from the LE!
Adding Fees
Adding Fees
• Without a valid Change Circumstance, adding Fees may
result in a tolerance violation, requiring a tolerance cure.
• Clients/Settlement Agents can add fees themselves in A.
Origination charges, F. Prepaids, H. Other
g
g
p
• Only NYCB can add fees to B. Services Borrower Did
N Sh
F
C S
i
B
Did Sh
F
d
Not Shop For, C. Services Borrower Did Shop For, and
E. Taxes and Other Government fees.
Deleting Fees
D l ti F Deleting Fees
• A user cannot truly “delete” a fee that has automatically carried over from the most recently disclosed NYCB LE.
• Instead, Fees can be reduced to $0.00 amount in the Closing Fees module.
• When reduced to a $0.00 amount, the Fee will not appear on the NYCB CD, but ill i i ibl i th F M d l ith th $ t
will remain visible in the Fees Module with the zero $ amount.
For Fees that are held to tolerances:
• When reduced to a $0.00 amount, this will reset the baseline for the Fee once the NYCB CD has been disclosed to the borrower. If this was done in error, and it needs to be re-disclosed at the correct higher amount, this can potentially create a tolerance violation.
→ Therefore, be very careful when lowering Fee amounts from
what carried over from the LE!
Tolerance Violations
As long as all Fees are within the allowable tolerance limits of the most
recently disclosed NYCB LE, no manual review of the Fee entry is required
before the NYCB CD can be sent to the borrower.
In addition, tolerance violations that result in Tolerance Cures of $50 or
less will not require manual review of the Fee entry before the NYCB CD
can be sent to the consumer.
In those cases where a Tolerance Cure of greater than $50 occurs, a
manual review process is automatically initiated and the user will not be
able to “submit” the CD Module and send the NYCB CD to the consumer
until manual review by NYCB has been completed
until manual review by NYCB has been completed.
PLEASE NOTE: All Tolerance Violations and Cures should be
avoided, regardless of the dollar amount. Tolerance Violations can
g
be avoided by the accurate and timely disclosure of Fees to the
consumer throughout the LE and CD process. Repeated Tolerance
Violations and resulting Tolerance Cures may result in the
Closing Fees Module Walkthrough
•
Link to a recording of a click through of the Closing Fees
Request Docs
Request Docs
Access to Request Docs
The Gemstone Request Docs module can be accessed once the
following have occurred:
• The underwriting disposition is Approved with PTCs*
• The Gemstone Appraisal has been ordered (or a PIW has been
received in AU)
received in AU)
• The loan is locked, the Flood Cert has been ordered, and MI has
been received (if applicable).
Both NYCB Clients and Settlement Agents will have access to
the Request Docs module (the Settlement Agent must be
selected in the Request Docs module to gain access).
selected in the Request Docs module to gain access).
*Currently, a full Approved underwriting disposition is required to
request Gemstone closing docs.
Closing Date in Request Docs
Th
li t ll
bl Cl i
D t th t
b
t
d i t R
t D
The earliest allowable Closing Date that can be entered into Request Docs
is controlled by all waiting periods that are applicable to a given loan:
• ECOA Appraisal Receipt Waiting Period • Flood Notice Waiting Period
• Commitment Letter Waiting Period (in applicable states) • New Initial loan Estimate Waiting Period
• New Revised Loan Estimate Waiting Period • New Closing Disclosure Waiting Period
Gemstone will provide detailed messaging when a date is entered that is
earlier than allowable.
earlier than allowable.
Please Note: Request Docs is only assessing the CD waiting periods for
the amount of time that is the best case scenario (3 business days from the
present date) At the point of Request Docs the NYCB CD has not been
present date). At the point of Request Docs, the NYCB CD has not been
created and sent to the borrower, and the borrower has not received the
NYCB CD. Once the NYCB CD is generated and received by the
Initial LE Waiting Period Before Closing
The Initial LE waiting period before closing is 7 business days
after the NYCB Initial LE has been delivered to the consumer
and is not impacted by delivery method (i.e. US Mail, Electronic,
In Person/Fa )
Revised LE Waiting Period Before Closing
Th R i d LE iti i d b f l i i 4 b i d ft th NYCB The Revised LE waiting period before closing is 4 business days after the NYCB Revised LE has been received by the consumer. The waiting period in Gemstone will be impacted by the delivery method of the Revised LE.
CD Waiting Period Before Closing
Th CD iti i d b f l i i 3 b i d ft th NYCB CD h b i d b th The CD waiting period before closing is 3 business days after the NYCB CD has been received by the consumer. The waiting period in Gemstone will be impacted by the delivery method of the CD.
The waiting periods below apply to both the initial CD that is generated, as well as any Revised CDs that have a Change Circumstance of the type that requires a new 3 business day waiting period (see slide 11 for
View Docs
The success of a Request Docs submission can be
checked in the View Docs module:
• If the preliminary, truncated paper docs package
(Closing Instructions, etc.) is available, the submission
(Closing Instructions, etc.) is available, the submission
was successful and the CD module will allow entry to
Save and/or Submit.
• If an error, Mavent Compliance Failure message, or QM
Failure message is present, then the error/failure must
Failure message is present, then the error/failure must
be addressed before access into the CD module will be
granted.
Closing Disclosure Module
Closing Disclosure Module
Completing the Closing Disclosure Module
C
l ti
f th CD
d l
i
i f
ti
th t h
t l
d
Completion of the CD module requires information that has not already
been captured in Request Docs or any other module. This information
must be completed by the NYCB Client or the Settlement Agent.
Once Gemstone closing docs have been successfully requested (passing
all regulatory reviews, etc.), the CD module will become available and can
be completed.
The CD module is a new link on the left hand nav in Gemstone.
Both NYCB Clients and Settlement Agents will have access to the CD
Module (the Settlement Agent must be selected in the Request Docs
Module (the Settlement Agent must be selected in the Request Docs
module to gain access).
Closing Disclosure Module- Layout
The CD Module was created to look very similar to the CD Form itself.
Each page of the CD form has a tab within the CD module.
Closing Disclosure Module- Fields to Complete
Most of the CD module will be automatically completed based on
Most of the CD module will be automatically completed based on
information input into other Gemstone modules.
Most of the information that has auto-populated from other Gemstone
d l
i
t dit bl i th CD M d l
modules is not editable in the CD Module.
• Instead, the information must be updated in the module from which it was auto-populated (e.g. Registration module, 1003, Closing Fees module, etc.)
There are some fields that have auto-populated with information and are
open and allow editing in the CD module, rather than requiring the user to
make updates in the module from which the information was sourced.
p
There are several fields that do not auto-populate and that require
completion.
PLEASE NOTE:
NYCB will be making a detailed guide available
regarding completion of the Closing Disclosure Module, and that covers
the above mentioned fields.
CD Module Demonstration
Pre Closing Review
Pre Closing Review
Pre-Closing Review
A loan must pass the Pre Closing Review in order to close and
fund.
Once a loan has reached an Underwriting Approved status, the
Client can generate the NYCB CD in Gemstone.
Once the CD has been created and sent to the consumer, the
Client can go through the Pre-Closing Review.
>>>TIMING CONSIDERATION: It is recommended that the Client
initiate the Pre Closing Review soon after generation of the CD.
Once the consumer has received the CD, there is a 3 business day
iti
i d d
i
hi h th P
Cl
i
R
i
b
waiting period, during which the Pre Closing Review can be
completed.
Pre-Closing Review
The Client must upload the following documentation to initiate the
Pre-Closing Review:
• Intent to Proceed Documentation (Example: Email or letter from the
Borrower(s), Loan Officer, or Staff notes regarding a conversation with the Borrowers that instructed the Loan Originator to proceed with the loan. • MLO Compensation Election FormMLO Compensation Election Form
• Hazard Insurance
• Flood Insurance (if applicable)
• Signed Ohio Notice of Change in Mortgage Terms (if applicable) • Proof of current tax payment
The Pre-Closing Review will consist of a review above the above
doc ments as ell as a re ie of Real Estate Ta Set Up and Escro s
documents as well as a review of Real Estate Tax Set-Up and Escrows
set-up in Request Docs (if applicable).
Uploading for the Pre-Closing Review
Upload all necessary documents to “Pre-closing Review” to start the review process Upload all necessary documents to Pre-closing Review to start the review process.
• Intent to Proceed Documentation (Example: Email or letter from the Borrower(s), Loan Officer, or Staff notes regarding a conversation with the Borrowers that instructed the Loan Originator to proceed with the loan.
• MLO Compensation Election FormMLO Compensation Election Form • Hazard Insurance
• Flood Insurance (if applicable)
• Signed Ohio Notice of Change in Mortgage Terms (if applicable) • Proof of current tax payment
Pre Closing Review Deficiencies
If th i i ith th d t ti id d th i f ti i th R t D d l NYCB
If there is an issue with the documentation provided or the information in the Request Docs module, NYCB will issue a deficiency notice to the client.
The deficiency notice will be e-mailed, faxed, and posted in Gemstone’s View Loan module. The loan status will appear as “Funding Requested Deficient”
The loan status will appear as Funding Requested- Deficient .
Closing/Funding
Closing/Funding
Closing Disclosure at Closing
The NYCB CD and an Addendum to the Closing Disclosure
document will be included in the Gemstone Closing Docs
package All consumers must sign the NYCB CD and the
package. All consumers must sign the NYCB CD and the
Addendum to the Closing Disclosure at closing.
On rescindable transactions, each consumer that has the
right to rescind must sign the NYCB CD at closing.
Seller’s CD
O h t ti NYCB ill t t th S ll ’ CD f
• On purchase transactions, NYCB will not generate the Seller’s CD from
Gemstone. The Settlement Agent is responsible for generating the Seller’s CD and providing it to the Seller.
• The Seller’s CD signed and dated by all sellers at closing must be uploaded to • The Seller s CD, signed and dated by all sellers at closing, must be uploaded to
