NOTARY SIGNING AGENT - cynanotary - Cynanotary · NOTARY SIGNING AGENT ... date document was...

NOTARYSIGNINGAGENTClassHandbook

CYNANOTARYFLORIDANOTARY&BUSINESSCENTER

7200WCommercialBlvd.,Ste.203,Lauderhill,FL33319www.cynanotary.com

notary@cynanotary.com954-977-9905

NSATableofContents

1. AnatomyofaLoan2. CriticalDocs3. GlossaryofMortgageTerms4. TipsSuccessfulSigningSkills5. ClosingInstructions6. YourFirstSigningfromBeginningtoEnd7. NSAScript(inclasshandout)8. ToolsoftheTrade9. HowtofillOutNotaryForms10. CFPBClosingDisclosure11. MockClosingPackage(inclasshandout)

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anatomy of a LoanWhere do you, the Notary, fit in?

´ In order for you to understand the scheme of things and where you fit in, we offer you the following “anatomy of Loan”. This may help you to understand how important your job is and how many people depend on you to do your job right!

´ For a borrower to obtain a loan involves a lot of people in a lot of different jobs, each one dependent on the other to get a loan to funding and closing.

´ Always remember that one mistake on your part could delay or cause a loan to cancel and everyone’s work will be wasted.

anatomy of a Loan

´ 1. Borrower applies for the Loan. (Loan Application also known as 1003)

´ 2. The lender or mortgage company then begins to process the loan by collecting all of the information required to approve the loan.

The Lender is the Bank, Credit Union, etc. The entity who will actually be loaning the money to the borrower.A Mortgage Company is the middle man who gathers all of the information for the lender to approve the loan. “They do all of the leg work.”

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anatomy of a Loan

´ 3. Underwriter who is responsible for reviewing all aspects of the request and either approves or disapproves the loan.

´ 4. At some point, usually after loan has been approved, an escrow account will be opened with either an escrow or title company.

anatomy of a Loan

´ 5. The Title Company will initiate a search of public records to determine all of the information for the property in question. Reports where any and all recorded liens against the property will be disclosed which can include Deeds of Trust, Mechanic Liens, Child Support Liens, Judgments and any other type of lien affecting the property.

´ “NPR – Notary Permit Runner”´ 6. After the loan is approved, the package goes to

a Loan Processor who is responsible for preparing the documents for the borrowers to sign.

anatomy of a Loan

´ 7. Notary Signing Service (Cynanotary)

´ 8. We locate and assign a Notary´ 9. Now the documents are ready to be signed and

the borrower is contacted to determine where and when the documents will be signed.

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anatomy of a Loan´ You are very IMPORTANT, many people depend on you to:

´ A. Handle the loan package with care and do your best be error free.

´ B. Work with the borrower to make the signing go smoothly and successfully, leaving a good impression behind.

´ “Often times you are the only face to face contact the borrower has in connection with their loan signing.”

´ C. Keep the lines of communication open so that everyone involved is aware of where you are in the process of signing and where the documents are at any given time.

´ D. Make sure that the loan package is shipped per instructions as soon as it is possible and without delay. Double check your signing requirements for fax backs and lender stipulations.

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Borrower’s First Payment

1. Informs borrower what the borrower's monthly payment for the loan will be.

2. The document breaks down the costs for principal and interest, property taxes; and fire, flood and mortgage insurance.

3. The document doubles as the borrower's initial payment voucher, if needed

Instructions to Escrow

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1. A summary of the terms and conditions of the loan used by the lender and closing agent.

2. Also referred to as the "closing instructions" 3. Lists the more important documents that are

contained in the loan package.4. States the conditions the borrower must meet

prior to closing.5. May or may not require signature.

Title/Escrow Disbursement

1. This form sent to the escrow and title companies involved with the closing of the loan along with the funds for disbursement.

2. Contains much the same information as the "Instructions to Escrow"

3. Is for information only and does not require a signature.

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Notice of Right to Cancel

1. Borrower’s notice of their right to cancel the transaction within a specified time frame.

2. "Notice of Right to Cancel" gives borrower three business days (including Saturdays) to cancel loan. There are three important dates referred to in the "notice of right to cancel":a) Document prep date: date document was drafted.b) Transaction date: date document was signed.c) End of rescission period date: termination date of

borrower's right to cancel loan.

Truth in Lending Disclosure (TIL)

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1. Required by the TIL for lenders to disclose in like manner so borrowers can compare loans. It is required to be in a certain format. It contains the following:a) The annual percentage rate with all the costs addedb) Finance chargesc) The amount financedd) Total payments and payment schedule.e) Prepayment penalties, if any.f) Assumption option, if allowed.

Initial Escrow Account Disclosure

1. Required by RESPA (Real Estate Settlement Procedures Act)2. RESPA, like TILA, helps consumers become better shoppers for

settlement services and eliminating kickbacks and referral fees.3. RESPA requires:

a) Booklet at time of loan appb) Before settlement/closing occurs: "affiliated business arrangement disclosure and a

HUD-1 Settlement Statement"c) After settlement "Annual Escrow Statement" and "Servicing Transfer Statement"

4. It outlines activity in an escrow or impound account in the coming year.

5. The disclosure breaks down monthly payment into:a) PIb) TI which go into the escrow account

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Itemization of Finance Charges

1. Itemizes finance and prepaid finance charges paid by the borrower. Shows being added to the loan.a) Fees listed on form have corresponding HUD-1

reference numbers that appear on the "HUD-1 Settlement Statement."

Good Faith Estimate of Settlement Charges

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1. RESPA disclosure: discloses estimated loan closing costs.

2. Form requires signature of borrower before proceeding with the drawing of loan documents. Will often be signed at signing appointment.

3. Includes corresponding "HUD-1 settlement statement" reference numbers.

4. States that the HUD-1 statement will show the actual cost for items paid at settlement.

Addendum to Good Faith Estimate of Settlement Charges

1. Lists additional estimated fees for closing that are not recorded on the "good faith estimate" and shows settlement service providers whose fees are itemized.

2. Fees itemized on the addendum will appear on "HUD-1 Settlement Statement"

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1. The settlement statement contains the actual closing costs for the loan.

2. The HUD-1 must be delivered or mailed to the borrower at or before the settlement.

3. The "Cash from/to borrower" (line 303) is where the Notary would check to see if the borrower must bring in funds for closing, provided the lender did not provide an instruction sheet for the Agent's use.

4. If no "Addendum to HUD-1" is provided, escrow typically will provide a place on each page of the settlement statement for the borrower to sign.

Addendum to HUD-1

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1. Additional fees are itemized and entered into line 811 of the settlement statement.

2. The addendum also includes payments made outside of escrow by the lender to the mortgage broker and are listed on line 812 of the "HUD-1 Settlement Statement."

3. Where an addendum to the "HUD-1 Settlement Statement" is included, the borrower signs at the bottom of the form.

4. A signature line for the closing agent also appears on the addendum. The Notary does not sign here.

Impound Authorization

1. Authorizes the lender to collect and manage that portion of a borrower's monthly payments for taxes, insurance and other items as they become due.

2. Hazard Insurance Authorization and requirements 3. This form outlines the lender's policies and minimum

requirements for a hazard insurance policy that must be provided.

4. After the authorization is signed and returned with the other documents in the loan package, the document will be submitted to the borrower's insurance agent, who will provide the necessary coverage. © CynANotary, LLC 2015 All Rights Reserved

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Borrower's Certification and Authorization

1. Found in most loan documentation packages, it states that information contained in loan application is true and complete, without misrepresentation or omission of important facts.

2. Form also authorizes lender to release loan-specific information to an investor looking to purchase the loan. Could include employment history and income, bank account balances, credit history, and copies of income tax returns.

Signature Affidavit and AKA Statement

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1. Borrower discloses any other names under which he/she is known and writes signatures for each name.

2. Form ensures signature verification and uniformity on all documentation.

3. Routinely notarized, however not always, even though the term "affidavit" suggests it should be.

4. If borrower does not enter other names by which they are known, borrower should complete blank spaces by inserting the words "not applicable" before Notary signing agent notarizes borrower's signature.

Compliance Agreement

1. By signing the "Compliance Agreement," the borrower agrees to cooperate with the lender or lender's agent in adjusting loan documentation for clerical errors after the property closes.

2. If an error is discovered in one of the forms after the closing, the borrower agrees to assist in rectifying the error.

3. Must be notarized

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Occupancy Affidavit and

Financial Status

1. Declares the borrower is going to live in the property.

2. Usually always notarized

FEMA 1009 affidavit

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1. Requires the borrower and seller to certify that the financial terms, liens, and occupancy conditions set forth in the document are true

2. The affidavit is used to induce the lender to make or purchase the first mortgage and the mortgage insurer, if any, to insure the loan.

3. The document is notarized with a jurat for both borrower and seller.

IRS Form 4506

1. This form requests a copy of the borrowers tax forms from the IRS in the case of an audit. It's only used in case of an audit.

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IRS Form W-9

1. Reports the mortgage interest.2. Verifies the borrower's Social Security number.3. Page 2 may require the borrower's initials.

Transfer of Servicing Disclosure

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1. RESPA form: informs the borrower of the lender's intent to sell the loan in the secondary market.

2. Must be signed by lender and acknowledged by borrower. Notarization is not required.

Fair Lending Notice

1. State and federal laws prohibit financial institutions from discriminating in their lending policies and loan packages.

2. Must be signed by the borrower.

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1. The written evidence of indebtedness and the borrower's promise to repay. Includes:a) Loan amountb) Interest ratec) Payment amountd) First payment due datee) Prepayment stipulationsf) Late charge terms and conditions, including default.

2. Initial on page 1 and sign on page 2.3. Held in conjunction with the deed of trust or

Deed of Trust (Mortgage)

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1. Is a security instrument whereby real property is pledged as security for a debt. Used in Washington.

2. A mortgage differs from a deed of trust in the way that foreclosure proceedings are handled. In states that use the mortgage foreclosure proceedings are handled by the State's legal system.

Usethisglossaryofmortgagetermstobetterunderstandtheoverallmortgageprocessaswellasanyspecificmortgagetermsthatmaybeunfamiliartoyou,fromBankofAmerica–oneofthemostdetail

closingcompanyAAbstractoftitleAwrittenhistoryofallthetransactionsrelatedtothetitleforaspecifictractofland.Anabstractoftitlecoverstheperiodfromtheoriginalsourceoftitle(oftentheoriginallandgrantfromtheUnitedStatesgovernmenttoanindividual)tothepresenttimeandsummarizesallsubsequentdocumentsthathavebeenrecordedagainstthattract.AcceptanceAbuyer’sorseller’sagreementtoenterintoacontractandbeboundbythetermsoftheoffer.AccountterminationfeeAfeethatmaybechargedifyoupayinfullandterminateyourhomeequitylineofcreditduringthefirst5years.Payingdowntoazerobalancedoesnotcountastermination.Seealso:prepaymentpenalty.AdditionalprincipalpaymentApaymentmadebyaborrowerofmorethanthescheduledprincipalamountdueinordertoreducetheoutstandingbalanceontheloan,tosaveoninterestoverthelifeoftheloanand/orpayofftheloanearly.Adjustable-ratemortgage(ARM)Amortgageinwhichyourinterestrateandmonthlypaymentsmaychangeperiodicallyduringthelifeoftheloan,basedonthefluctuationofanindex.Lendersmaychargealowerinterestratefortheinitialperiodoftheloan.MostARMshavearatecapthatlimitstheamounttheinterestratecanchange,bothinanadjustmentperiodandoverthelifeoftheloan.Alsocalledavariable-ratemortgage.AdjustmentcapAlimittohowmuchavariableinterestratecanincreaseordecreaseinasingleadjustmentperiod.AdjustmentdateThedateonwhichtheinterestratechangesforanadjustable-ratemortgage(ARM).AdjustmentperiodTheperiodoftimebetweenadjustmentdatesforanadjustable-ratemortgage(ARM).AffordabilityanalysisApreliminaryanalysisofaborrower’sabilitytoaffordthepurchaseofahomethattakesintoconsiderationfactorssuchasincome,liabilitiesandavailablefunds,aswellasthetypeofhomeloan,thelikelytaxesandinsuranceforthehomeandtheestimatedclosingcosts.Seealso:PrequalificationAmortizationThegradualreductionintheprincipalamountowedonadebt.Duringtheearlieryearsoftheloan,mostofeachpaymentisappliedtowardtheinterestowed.Duringthefinalyearsoftheloan,paymentamountsareappliedalmostexclusivelytotheremainingprincipal.AmortizationtableorscheduleAtimetableorschedulethatgivesyouabreakdownofyourmonthlypaymentsintoprincipalandinterest.Youcanusethisscheduletofigureouttheamountofprincipalyou’llberepayingduringyourmortgageterm.AmortizationtermTheamountoftimerequiredtoamortize(payoff)theloan,expressedinmonths.Forexample,fora15-yearfixed-ratemortgage,theamortizationtermis180months.AnnualadjustmentcapAlimitonhowmuchthevariableinterestrateonaloancanincreaseordecreaseeachyear.

Annualpercentagerate(APR)Theannualcostofaloantoaborrower.Likeaninterestrate,theAPRisexpressedasapercentage.Unlikeaninterestrate,however,itincludesotherchargesorfees(suchasmortgageinsurance,mostclosingcosts,discountspointsandloanoriginationfees)toreflectthetotalcostoftheloan.TheFederalTruthinLendingActrequiresthateveryconsumerloanagreementdisclosetheAPR.SincealllendersmustfollowthesamerulestoensuretheaccuracyoftheAPR,borrowerscanusetheAPRasagoodbasisforcomparingthecostsofsimilarcredittransactions.ApplicationfeesNonrefundablefeespaidwhenyouapplyforyourloan.Thesefeesmayincludechargesforitemssuchas,forexample,acreditprofileorapropertyappraisal.AppraisalorappraisedvalueAninformedestimateofthevalueofaproperty.Whenmadeinconnectionwithanapplicationforaloansecuredbyahome,aprofessionalappraiserusuallyperformstheappraisal.AppraisalcontingencyAcontingencyinasalescontractthatthepropertymustappraiseatavaluethatisequaltoorgreaterthanyourofferingprice.AppreciationAnincreaseinthevalueofpropertyovertime.Importantfactorsinahome’sappreciationareitslocation,conditionandthesellingpriceofsimilarhomesinthearea.Appreciationincreasestheamountofequity,whichmayalsoincreasetheamountyoucanborrowforahomeequitylineofcredit.Approvedterm(afterapproval)Thenumberofmonthsthatitwilltaketopayoffyourloan.Theapprovedtermisusedtodeterminethepaymentamount,repaymentscheduleandtotalinterestpaidoverthelifeoftheloan.Seealso:TermApprovedterm(beforeapproval)Thenumberofmonthsthatitwilltaketopayoffyourloan.Theapprovedtermisusedtodeterminethepaymentamount,repaymentscheduleandtotalinterestpaidoverthelifeoftheloan.Seealso:TermAssessedvalueThevalueofaproperty,establishedbyapublictaxassessor.Theassessedvalueisusedtodeterminepropertytaxes.AssignmentThemethodoftransferringarightorcontract,suchasthetermsofaloan,fromonepersontoanother.AssumableloanAloanthatmaybetransferredtosomeoneelsewhilemaintainingthesameterms.Forexample,ifyouhaveanassumableloan(notallloansareassumable)andyousellyourhome,youmaybeabletotransferthatloantothenewownerwithnochangeintheinterestrateandrepaymentschedule,thoughyoumayneedtopayafeeinordertodoso.BacktotopBBalancesheetAdatedfinancialstatement(intableform)thatshowsyourassets,liabilitiesandnetworth.BalloonloanAloanthatprovidesyouwithlower-than-usualmonthlypaymentsforasetperiodoftimefollowedbyapaymentlargerthanusualattheendofyourloanrepaymentperiod.Whileaballoonloanmayloweryourmonthlypaymentsitcanalsomeanyoumakehigherinterestpaymentsoverthelifeoftheloan.Baserate

Aninterestratethatisusedasabenchmark,orindex,forpricingvariable-rateloanssuchasadjustable-ratemortgages,autoloansandcreditcards.BasispointAnamountequalto1/100thofapercentagepoint.Forexample,afeecalculatedas50basispointsof$200,000wouldbe0.50%or$1,000.BondAninterest-bearingcertificateofdebtwithamaturitydate.Arealestatebondisawrittenobligationthatisusuallysecuredbyamortgageoradeedoftrust.BreakevenpointThepointatwhichtotalincomeequalstotalexpenses.Alsousedinconnectionwithdecisionsrelatedtopurchasingdiscountpointsonamortgage.Calculatingthebreakevenpointwillidentifyhowmanymonthsitwilltaketorecoupthecostsassociatedwithpayingforthediscountpointamountunderconsideration.Inotherwords,if$3,600ispaidtowarddiscountpointstoreducetheinterestrateandthereducedratewoulddecreasethemonthlymortgagepaymentby$100,itwouldtake3yearstobreakevenonthechoicetopaythediscountpointamount.BridgeloanAtypeofmortgagefinancingbetweentheterminationofoneloanandthestartofanotherloan.Forexample,abridgeloanmightbetakenoutbyaborrowerandsecuredbythatborrower’spresenthomesothattheclosingonanewhousecantakeplacebeforethepresenthomeissold.BrokerAthirdpartywhoarrangesfundingornegotiatesacontractbetweenparties,butdoesnotlendthemoney.BrokerfeesFeeschargedbyarealestatebrokeroramortgagebrokerforprovidingassistanceinarealestatetransaction.BuydownThelump-sumprepaymentofalloraportionofyourmortgageinterestbyalenderorhomebuilderinordertoloweryourmonthlymortgagepayment,typicallyforaperiodof1-3years.Seealso:TermBacktotopCCalloptionAprovisioninaloanthatgivesthelendertherighttoacceleratethedebtandrequirefullpaymentoftheloanimmediatelyattheendofaspecifiedperiodorforspecifiedreason.CapAlimitonhowmuchavariableinterestratecanincrease.Manyadjustable-ratemortgageshavebothannual(orsemiannual)ratecapsandlifetimecaps.Theylimittheamountyourpaymentscanincreaseinanadjustmentperiodandoverthelifeoftheloan.See:InterestratecapCashavailableforclosingBorrowerfundsthatareavailabletocoverdownpaymentandclosingcosts.Iflendingguidelinesrequiretheborrowertohavecashreservesatthetimetheloanclosesorthatthedownpaymentcomefromspecifiedsources,theborrower’scashavailableforclosingdoesnotincludecashreservesormoneyfromthosespecifiedsources.CashtocloseTheamountahomebuyerneedsincashattheclosingoftheloan.Thistypically,thisincludesdownpaymentandclosingcosts.Cash-outrefinance

Arefinancetransactioninwhichthenewloanamountexceedsthetotaloftheprincipalbalanceoftheexistingfirstmortgageandanysecondarymortgagesorliens,togetherwithclosingcostsandpointsforthenewloan.Thisexcessisusuallygiventotheborrowerincashandcanoftenbeusedfordebtconsolidation,homeimprovementoranyotherpurpose.CeilingrateThemaximuminterestratethatcanaccrueonavariablerateloanoradjustable-ratemortgage(ARM).CertificateofeligibilityAdocumentissuedbythefederalgovernmentcertifyingaveteran’seligibilityforaDepartmentofVeteransAffairs(VA)loan.Certificateofreasonablevalue(CRV)AdocumentissuedbytheDepartmentofVeteransAffairs(VA)thatestablishesthemaximumvalueandloanamountforaVAloan,basedonanapprovedappraisal.CertificateoftitleAstatementprovidedbyanabstractcompany,titlecompanyorattorneystatingwhoholdstitletorealestatebasedonthepublicrecord.ChainoftitleThehistoryofallofthedocumentsaffectingtitletoaparcelofrealproperty,startingwiththeearliestexistingdocumentandendingwiththemostrecent.CleartitleTitlesthataremarketableandarefreeofliensordisputedlegalquestionsastoownershipoftheproperty.CloseTheClosestepisthedateyouwillsignandexecuteyournewloandocuments.Dependingonthelocationofthepropertyortypeoftransaction,thethreebusinessdaysrightofrescissionperiodmayapplybeforeyourfundsareavailabletoyou.Thethreebusinessdaysrightofrescissionperiodstatesthatincertainrealestatesecuredtransactionsthatinvolvetherefinanceofaprimaryresidence,theTruthinLendingActallowsapplicants3businessdaystocancelthetransactionandprohibitslendersfromdisbursingproceedsuntilaftertherescissionperiodhaslapsed.ClosedAstatusofclosedindicatesthatnofurtheractionisrequiredonthisitem.ClosingThetimeandplace,atwhichalldocumentsforyourloanaresigned,dated,andnotarized.Seealso:settlement.ClosingcostsClosingcosts,alsoknownassettlementcosts,arethecostsincurredwhenobtainingyourloan.Fornewpurchases,thesecostsalsoincludeownershiptransferofanycollateralpropertyfromthesellertoyou.Costsmayincludeandarenotlimitedto:attorney'sfees,preparationandtitlesearchfees,discountpoints,appraisalfees,titleinsurance,andcreditreportcharges.Theyaretypicallyabout3%ofyourloanamount,andareoftenpaidatclosingorjustbeforeyourloancloses.Fundsoftenneededtoclosealoan,suchashomeownersinsurance,propertytaxes,andescrowimpoundaccountfunds,aren'tincludedinclosingcostsandareconsideredseparate.Youshouldbepreparedtopaythesecostsbeforeyourloancloses.ClosingdateThedateyouwillsignyournewloandocuments.ClosingDisclosure(CD)

Aclosingdocumentwhichprovideskeyinformationsuchasinterestrate,monthlypayments,andcoststoclosetheloan.Consumersarerequiredtoreceivethisformnolaterthan3businessdaysbeforetheycloseontheloan.ClosingstatementAnaccountingoffundsgiventobothbuyerandsellerbeforerealestateissold.Co-borrowerAnadditionalpersonwhoassumesequalresponsibilityforrepaymentofaloanandisfullyobligatedunderthetermsoftheloan.Thispersonalsohasequalrightstotheproceedsoftheloan.COBRA(ConsolidatedOmnibusBudgetReconciliationAct)Requiresemployerswithmorethan20employeestomakegrouphealthcarecoverageavailablefor18months,attheemployee’sexpense,toemployeeswholeavetheemployerforanyreasonotherthangrossmisconduct.CoinsuranceAsharingofinsuranceriskbetweentheinsurerandtheinsured.Coinsurancedependsontherelationshipbetweentheamountofthepolicyandaspecifiedpercentageoftheactualvalueofthepropertyinsuredatthetimeoftheloss.CollateralAnasset,suchasacarorahome,usedforsecuringtherepaymentofaloan.Theborrowerriskslosingtheassetiftheloanisnotrepaid.CollectionTheeffortsusedtobringadelinquentloancurrentand,ifnecessary,tofilelegalpapersandnoticestoproceedwithforeclosure.CombinationLoanAcombinationloanpairsaconformingfirstmortgagewithahomeequitysecondmortgageforupto80%oftheproperty'svalueinasingleapplicationwith1downpayment.Combinationloansmayhelpyouavoidthehigherratesofajumbofirstmortgage.Combinationloansaremadeupof3parts:70%firstmortgage,10%homeequitysecondmortgageand20%downpayment.CombinedliensTheoutstandingbalanceofallmortgagesheldonaproperty.Usedtodeterminethetotalavailableequitywhenconsideringtheappraisedvalueofthepropertylesstotalcombinedoroutstandingliens.Combinedloan-to-valueratio(CLTV)Theratiobetweentheunpaidprincipalamountofyourfirstmortgage,plusyourcreditlimitifyouhaveahomeequitylineofcredit,andtheappraisedvalueofyourhome.Expressedasapercentage.CommitmentletterAformalnotificationfromalenderstatingthattheborrower’sloanhasbeenconditionallyapprovedandspecifyingthetermsunderwhichthelenderagreestomaketheloan.Seealso:LoancommitmentComparables(comps)Propertiessimilartothepropertyunderconsiderationforamortgagethathaveapproximatelythesamesize,locationandamenitiesandhaverecentlybeensold.Comparableshelpanappraiserdeterminethefairmarketvalueofaproperty.CompoundinterestInterestpaidontheprincipalbalanceandontheaccruedandunpaidinterest.ConformingloanAmortgageloanthathasthestandardfeaturesasdefinedby(andiseligibleforsaleto)FannieMaeandFreddieMac.Constructionloan

Ashort-terminterimloanforfinancingthecostofhomeconstruction.Thelendermakespaymentstothebuilderatperiodicintervalsastheworkprogresses.ContingencyAspecifiedconditioninasalescontractthatmustbesatisfiedbeforethehomesalecanoccur.Whenbuyingahome,the2mostcommoncontingenciesarethatthehousemustpassinspectionandthattheborrowermustbeapprovedforaloan.ConventionalloanAhomeloanthatisnotinsuredorguaranteedbythefederalgovernment.Aconventionalloancanbeforconformingornon-conformingloanamounts.ConvertibilityclauseAprovisioninsomeadjustable-ratemortgages(ARMs)thatallowstheborrowertochangetheARMtoafixed-rateloanatspecifiedtimesduringthelifeoftheloan.ConvertibleARMAnadjustable-ratemortgage(ARM)thatcanbeconvertedtoafixed-rateloanunderspecifiedconditions.ConveyTotransferordelivertitletopropertyfromonetoanotherbydeedorcontract.Whenanitembecomesapartofthetransferoftitle,itisconveyedwiththeproperty.Co-signerAsecondpersonwhosignsyourloanandassumesequalresponsibilityforpaymentoftheloanbutreceivesnobenefitfromtheloanproceeds.CostofFundsIndex(COFI)Anindexthatisusedtodetermineinterestratechangesforcertainadjustable-ratemortgages(ARMs).Itrepresentstheweighted-averagecostofsavings,borrowingsandadvancesofthe11thDistrictmembersoftheFederalHomeLoanBankofSanFrancisco.Seealso:Adjustable-ratemortgage(ARM)CovenantApromiseinamortgageordeedthatrequiresorpreventscertainusesofthepropertythat,ifviolated,mayresultinlossorforeclosureoftheproperty.CreditbureauAnorganizationthatgathers,records,updatesandstoresfinancialandpublicrecordsofindividualswhohavebeengrantedcreditandprovidesthisinformationtolendersandotherauthorizedusersforafee.The3majorcreditbureausareEquifax,ExperianandTransUnionandyouarelegallyentitledtoreceive1freereporteachyearfromeachoftheseagencies.CreditlimitThemaximumamountyoucanborrowunderalineofcredit.CreditmonitoringserviceAservicethatoffersthebenefitofearlydetectionofunauthorizedactivityinordertolimittheamountoffinancialdamagethatapersonmaysufferatthehandsofanidentitythief.CreditreportArecordofanindividual’sdebtsandpaymenthabits.Ithelpsalenderdeterminewhetherornotapotentialborrowerisagoodbusinessrisk.The3majorcreditbureausthatprovidecreditreportsareEquifax,ExperianandTransUnionandyouarelegallyentitledtoreceive1freereporteachyearfromeachoftheseagencies.LearnhowtoreadacreditreportCreditriskThelikelihoodthataborrowerwillpaytheirobligationsasagreed.Borrowerswhopayasagreedposelesscreditrisktolenders.Creditscore

Anumberthatratesthequalityofanindividual’scredit.Thenumberhelpspredicttherelativelikelihoodthatapersonwillrepayacreditobligation,suchasamortgageloan.Ingeneral,thehigheryourcreditscore,themorelikelyyouaretobeapprovedforandtopayalowerinterestrateonaloan.SeehowBankofAmericacreditcardholderscanobtainafreemonthlyscoreCreditorApersonorbusinessfromwhomyouborrowortowhomyouowemoney.CreditworthinessThelikelyabilityofaborrowertorepaydebt.CumulativeinterestTotalinterestaccrued.CurtailmentApaymentthatreducestheprincipalbalanceofaloan.BacktotopDDebtconsolidationAsingleloantopayoffmultipledebts,usuallyoveralongerterm.Thisisapopularuseforahomeequitylineofcredit.Debt-to-incomeratioYourtotalmonthlydebtpayments(forexample:loans,creditcardsandcourt-orderedpayments)dividedbyyourgrossmonthlyincomebeforetaxesandexpressedasapercentage.FederalHousingAdministration(FHA)guidelinesinearly2017recommendthatyourmonthlymortgagepaymentshouldbenogreaterthan31%ofyourmonthlyincomebeforetaxesandyourtotalmonthlydebtshouldbenogreaterthan43%ofyourmonthlyincomebeforetaxes.Deed(warrantyorquit-claim)Adocumentthatlegallytransfersownershipofrealestatefromasellertoabuyeranddeliveredtothebuyeratclosing.Beforemakingaloan,alenderwillusuallyrequireatitlesearchoratitlereporttomakesuretheborrowerlegallyownstherealestatetthatisbeingusedtosecuretheloan.DeedoftrustThedocumentusedinsomestatesinsteadofamortgage;titleisvestedinatrusteetosecurerepaymentoftheloan.DefaultFailuretomakemortgagepaymentsontimeortomeetothertermsofaloan.Defaultcanleadtoforeclosure.DelinquencyFailuretomakepaymentsontime.DiscountpointsSee:PointsDownpaymentTheamountofcashyoupaytowardthepurchaseofyourhometomakeupthedifferencebetweenthepurchasepriceandyourmortgageloan.Downpaymentsoftenrangebetween5%and20%ofthesalespricedependingonmanyfactors,includingyourloan,yourlenderandyourcredithistory.Howmuchofadownpaymentshouldyoumake?DrawTheprocessofobtaininganadvanceagainstyouravailablelineofcredit.DrawperiodTheperiodduringwhichaborrowercanobtainadvances(alsocalleddraws)fromanavailablelineofcredit.Attheendofthedrawperiod,borrowersmaybeabletorenewthecreditlineorberequiredtopaytheoutstandingbalanceinfullorinmonthlyinstallments.

Due-on-saleprovisionAprovisioninamortgagehomeloanthatallowsthelendertodemandrepaymentinfulliftheborrowersellsthepropertythatservesassecurityfortheloan.BacktotopEEarnestmoneyAdepositmadetowardadownpaymentasasignofgoodfaith.Thedepositistypicallymadewhenapurchaseagreementissigned.EncumbranceAnylienorliabilityattachedtoapropertythataffectsorlimitsthetitletothatproperty,forexampleunpaidtaxes,mortgagesandleases.EqualCreditOpportunityAct(ECOA)Afederallawthatrequireslendersandothercreditorstomakecreditavailablewithoutdiscriminationbasedonrace,color,religion,nationalorigin,age,sex,maritalstatusorreceiptofincomefrompublicassistanceprograms.LearnmoreabouttheECOAEquityThedifferencebetweenthefairmarketvalue(appraisedvalue)ofyourhomeandyouroutstandingmortgagebalancesandotherliens.EscrowFundsdepositedwithathirdparty,tobehelduntilaspecificdateisreachedand/oraspecificconditionismet.EscrowimpoundaccountTypicallyreferstoanaccountsetupbyalenderinwhichfundstopayforrealestatetaxesandhomeownersinsurancearedepositedaspartoftheborrower'smonthlymortgagepayment,thendisbursedastaxandinsurancepaymentscomedue.EscrowanalysisTheperiodicexaminationofescrowaccountstodetermineifcurrentmonthlydepositswillprovidesufficientfundstopaytaxes,insuranceandotherbillswhendue.BacktotopFFairCreditReportingAct(FCRA)LawpassedbyCongresstogiveborrowerscertainrightswhendealingwithconsumerreportingagencies,orcreditbureaus.Allcreditbureausarerequiredtoprovideaccuratecredithistoriestoauthorizedbusinessesforuseinevaluatingapplicationsforinsurance,employment,creditorloans.LearnmoreabouttheFCRAFairmarketvalueThelikelysellingpriceofahome.Thefairmarketvalueisusuallydeterminedbyanappraisal.FannieMaeFederalNationalMortgageAssociation,agovernment-sponsoredenterprisethatbuysandsecuritizesmortgagesforresaleinthesecondarymarket.VisittheFannieMaewebsiteFederalHousingAdministration(FHA)AnagencyoftheDepartmentofHousingandUrbanDevelopment.TheFHAprovidesmortgageinsuranceforcertainresidentialmortgages.Italsosetsstandardsforunderwritingthesemortgagesandforconstructionofhomessecuredbythesemortgages.VisittheFHAwebsiteFeeSimpleClearandabsoluteownershipofapieceofproperty.Thefeesimpleownerofapropertyhastherighttousethelandinanywaydesired,forexample:buildonit,sellitorleaseit.FHAhomeloan

AmortgagethatisinsuredbytheFederalHousingAdministration(FHA).Alsoknownasagovernmentloan.FHAmortgageinsuranceprotectsthelender(nottheborrower)ifaborrowerdefaultsontheFHAloan.Thisinsuranceenablesalendertoprovideloanoptionsandbenefitsoftennotavailablethroughconventionalfinancing.FICO®AnacronymforFairIsaacCorporation,whichdevelopsthemathematicalformulasusedtoproducecreditscoresforassessingcreditrisk.FICOscoresfallbetweenalowof300andahighof850.ThehighertheFICOscore,thelowercreditriskaconsumerpresents.LearnmoreaboutFICOscoresFinancechargeThecostofconsumercreditexpressedasadollaramount.Itincludestheamountofinterestyouwillpayduringthetermsoftheloan,originationpointsandcertainotheritems.Someclosingcostsarenottreatedasfinancecharges.FirstmortgageAmortgagethatistheseniorlienagainstaproperty.Fixed-ratemortgageAhomeloanwithapredeterminedfixedinterestratefortheentiretermoftheloan.Fixed-rateoption(Fixed-RateLoanOption)Anoptionavailableoncertainhomeequitylinesofcreditallowingborrowerstofixthepaymentsandinterestrateonaportionoftheiroutstandingprincipalbalanceforaspecificterm.Customersmaybechargedafeeforthisprivilege.FloatingrateAloanrateforwhichthelenderhasnot"locked"orcommittedtolendataparticularinterestrate.Thefloatinginterestrateandanydiscountpointsarenotguaranteed.Youractualinterestrateanddiscountpointswillbebasedonthemarketpriceavailableforyourloanproductatthetimeyourinterestrateislocked.FloodcertificationAdeterminationbyareputablesourceaboutwhetherpropertyislocatedwithinaspecialfloodhazardzone.FloodinsuranceInsurancethatprotectsagainstlossduetofloods.Whenavailable,thistypeofinsuranceisrequiredbylawwhenapropertyislocatedwithinaspecialfloodhazardzone.ForbearanceAperiodduringwhichyourmonthlyloanpaymentsaretemporarilysuspendedorreduced.Youmayqualifyforforbearanceifyouarewillingbutunabletomakeloanpaymentsduetocertaintypesoffinancialhardships.Duringforbearance,principalpaymentsarepostponedbutinterestcontinuestoaccrue.ForeclosureAlegalprocedureinwhichpropertysecuringadefaultedloanissoldbythelenderinordertorepayaborrower’sloan.Theamountpaidbyabuyerattheforeclosuremaynotbeenoughtofullyrepaytheloanandtheborrowermaycontinuetoowethelenderthedifference.ForfeitureThelossofmoney,property,rightsorprivilegesduetoabreachoflegalobligation.Form1098Alegaltaxformthatreportstheamountofinterestandpointspaidduringthepreviousyear.FreddieMacAgovernment-sponsoredenterprisethatbuysandsecuritizesmortgagesforresaleinthesecondarymarket.VisittheFreddieMacwebsiteFundingdateThedateonwhichtheproceedsfromaloanareavailabletoordisbursedforthebenefitoftheborrowers.Backtotop

GGoodfaithestimate(GFE)Anitemized,detailedlistofcertainestimatedcostsassociatedwithahomeloanthatthelenderisrequiredtoprovidetotheborrowerwithin3businessdaysoftheapplication.GovernmentloanAloanthatisinsuredbytheFederalHousingAdministration(FHA),guaranteedbytheDepartmentofVeteransAffairs(VA)orguaranteedbytheRuralHousingService(RHS).Theinsuranceprotectsthelender(nottheborrower)ifaborrowerdefaultsontheloan.Thisinsuranceenablesalendertoprovideloanoptionsandbenefitsoftennotavailablethroughconventionalfinancing.GovernmentNationalMortgageAssociation(GNMAorGinnieMae)Agovernment-ownedcorporationwithintheU.S.DepartmentofHousingandUrbanDevelopment(HUD).CreatedbyCongressonSeptember1,1968,GNMAassumedresponsibilityforthespecialassistanceloanprogramsformerlyadministeredbyFannieMae.VisittheGinnieMaewebsiteBacktotopHHazardinsuranceSee:HomeownersinsuranceHomeequitylineofcredit(HELOC)Alineofcreditsecuredbytheborrower'sresidence.ThetypicalHELOCtermis30years:a10-yeardrawperiodfollowedbya20-yearrepaymentperiod.AHELOCisoftenusedforhomeimprovements,debtconsolidationorothermajorexpenses.Inmostcases,youcanwithdrawfundsuptoyouravailablecreditlimitforthefirst10years(yourdrawperiod)usingconveniencechecks,debitcardsormoneytransferviaOnlineBanking.LearnmoreaboutHELOCsHomeownersinsuranceInsurancetoprotectyourhomeagainstdamagefromfire,hurricanesandothercatastrophes.Usually,homeownersinsurancealsocoversyouagainsttheftandvandalism,aswellaspersonalliabilityincasesomeoneishurtorinjuredonyourproperty.Alenderwilllikelyrequireyoutonameitasapayeeundertheinsuranceifyouneedtomakeaclaim.Alsocalledhazardinsurance.HUDAnacronymfortheU.S.DepartmentofHousingandUrbanDevelopment.HUDisagovernmentagencyresponsiblefortheimplementationandadministrationofhousingandurbandevelopmentprograms.Amongotherthings,HUDadministerstheFederalHousingAdministration,enforcesRESPAregulationsandoverseesFannieMaeandFreddieMac.VisittheHUDwebsiteBacktotopIImpoundaccountSee:EscrowimpoundaccountImpoundingThecollectionandplacementofmoniesbyalenderintoanaccountinordertopaytheborrower’spropertytaxesandinsurancepremiumswhentheybecomedue.IncomeRegularincomefromearnings,commissions,investments,rentalpaymentsorothersources.IncomepropertyRealestatedevelopedorimprovedtoproduceincome.IndexWhenusedinamortgagenoteorcreditagreement,afinancialindexisthemeasurementusedtodecidehowmuchtheannualpercentageratewillchangeatthebeginningofeachadjustmentperiod.Generally,theindex

plusorminusmarginequalsthenewratethatwillbecharged,subjecttoanycaps.Lendersusevariousfinancialindexrates:LondonInterbankOfferedRate[(LIBORandTreasury-IndexedARMs(T-Bills)]InflationrateTheincreaseinpriceofconsumergoods,usuallyexpressedasapercentageoveraspecificperiodoftime.InitialadvanceTheprocessofobtaininganadvanceagainstavailablecreditunderyourlineofcredit.InitialadvanceatclosingYouhavechosenourfundstransferoptiontoreduceyourinterestrate.Pleaseverifythattheaccountinformationiscorrect.Ifyoumaintainatleastthis$25,000balanceforthefirstthreeconsecutivebillingcyclestheaccountisopen,youwillreceive.25%offyourapprovedrateforthelifeoftheline.Initialadvanceof$25,000ormoreTheinitialadvanceof$25,000ormorediscountappliesfordrawinganinitialadvanceof$25,000ormore,andmaintainingatleastthatminimumbalanceforthefirst3fullconsecutivebillingcycles.InitialdrawamountTheproceedsofthehomeequitylineofcreditorconstructionloanuptoanamounttheborrowerisallowedtorequestatclosing.InitialrateThestartinginterestrate.Somepeoplecallthisthe“teaserrate,”becauseitgivesyoulowinterestandlowmonthlypaymentsatthebeginning,butmayadjustupatthenextadjustmentperiod(itwillusuallyadjusteveniftheindexdoesn’tgoup,sinceit’slowerthanindexplusmarginfortheinitialperiod).InquiryArequestforyourcreditreport,madebyyouoracompanyconsideringyouforanofferofcredit.InstallmentloanAloanthatisrepaidinequalpayments,knownasinstallments.InsuranceAcontractthatprovidescompensationforspecificlossesinexchangeforaperiodicpayment.Anindividualcontractisknownasaninsurancepolicy,andtheperiodicpaymentisknownasaninsurancepremium.InsurancebinderAdocumentthatstatesthatinsuranceistemporarilyineffect.Becausethecoveragewillexpirebyaspecifieddate,apermanentpolicymustbeobtainedbeforetheexpirationdate.InsuredmortgageAmortgagethatisprotectedbyaninsurerincaseofdefault.Theinsuranceprotectsthelender(nottheborrower)ifaborrowerdefaultsontheloan.InterestaccrualrateThepercentagerateatwhichinterestaccruesonthemortgage.Inmostcases,itisalsotherateusedtocalculatethemonthlypayments.Interest-onlyloanAloanforwhichyoupayonlytheinterestdueforaportionoftheloanterm.Thislowersyourperiodicpaymentbutdoesnotdecreaseyourprincipalbalanceontheloan.Makinginterest-onlypaymentswillresultinlargerpaymentsbeingdueattheendoftheinterest-onlypaymentperiod.Seealso:BalloonloanInterestrateTheannualcostofaloantoaborrower,usuallyexpressedasapercentage.Theinterestratedoesnotincludefeeschargedfortheloan.Seealso:Annualpercentagerate(APR)InterestratebuydownSee:BuydownInterestratecap

Alimitonhowmuchthevariableinterestratecanincreaseatanyonetime.Manyhomeloanshavebothannual(orsemiannual)capsandlifetimecaps,whichlimittheamountyourpaymentscanincreaseinanadjustmentperiodandoverthelifeoftheloan.Manycapsallowarateincreaseof2-5%overthestartinginterestrateinanadjustmentperiod(forexample,astartingrateof5%couldincreaseto7%or,dependingontheloanguidelines,toasmuchas10%).Alender’slifetimeinterestratecapistypically6%overthelifeoftheloan.InvestmentpropertyPropertythatispurchasedtogeneraterentalincome,ortobesoldonceithasappreciatedinvalue.BacktotopJJudgmentAdecreebyacourtoflawthatonepersonisindebtedtoanotherforaspecifiedamount.Insomestates,thecourtmayplacealienagainstthedebtor’srealpropertyascollateralforpaymentofthejudgmenttothecreditor.JumboloanAlsoknownasanonconformingloan.TheamountoftheloanexceedsstandardsthatwouldmakeiteligibleforsaletoFannieMaeandFreddieMac.Certaingeographicalareashavetemporaryconformingloanlimitshigherthantypicalconforminglimits.Lendersmaychargeadditionalfeesandplacecertainrestrictionsduetothelargeloanamounts.LearnmoreaboutjumboloansBacktotopKNoentriesforthisletter.BacktotopLLiabilitiesAperson’sdebtsorfinancialobligations.Liabilitiesincludelong-termandshort-termdebt,aswellaspotentiallossesfromlegalclaims.LiabilityinsuranceSee:HomeownersinsuranceLIBORLondonInterbankOfferingRate;anindexcommonlyusedforsomeadjustable-ratemortgages(ARMs).LienThelegalclaimofacreditoronaborrower’sproperty,tobeusedassecurityforadebt.LienholderAnindividualorentitythathasplacedalienonrealproperty.LifetimeadjustmentcapAlimitonhowmuchthevariableinterestratecanincreaseduringthetermofaloan.LineofcreditAnagreementbyalendertoextendcredituptoamaximumamountforaspecifiedtime.Inahomeequitylineofcredit,thelineofcreditissecuredbytheborrower’shome.LearnmoreaboutahomeequitylineofcreditLoancommitmentAformalnotificationfromalenderstatingthattheborrower’sloanhasbeenconditionallyapprovedandspecifyingthetermsunderwhichthelenderagreestomaketheloan.LoanEstimate(LE)Disclosuretohelpconsumersunderstandthekeyloantermsandestimatedcostsofamortgagebeforetheymakeacompleteapplication.Afteraconsumersubmits6keyelements:name,income,socialsecurity

number,propertyaddress,estimatedpropertyvalueanddesiredloanamount,thelenderisrequiredtoprovidethisform.Alllendersarerequiredtousethesamestandardloanestimateformtomakeiteasierforconsumerstocompareandshopforamortgage.LoanmodificationChangestooneormoreofthetermsofaloan.LoanoriginationTheprocessbywhichamortgagelendermakesahomeloanandrecordsamortgageagainsttheborrower’srealpropertyassecurityforrepaymentoftheloan.LoantermSee:TermLoan-to-valueratio(LTV)Theratiobetweentheunpaidprincipalamountofyourloan,oryourcreditlimitinthecaseofalineofcredit,andtheappraisedvalueofyourcollateral.Expressedasapercentage.Forexample,ifyouhavean$80,000firstmortgageonapropertywithanappraisedvalueof$100,000,theLTVis80%($80,000/$100,000=80%).LockperiodTheamountoftimepriortoclosingthatyoucansecureaninterestrateforyourloan.Lockperiodstypicallyrangefrom30daystomorethan90days.Generally,thelongerthelockperiod,themoreyoupayinpointsorinterest.BacktotopMManufacturedhousingAstructurethathasbeenpartiallyorentirelyconstructedatanotherlocationandmovedontotheproperty(onapermanentfoundation).Amanufacturedhomemayormaynotbeamobilehome.MarginThenumberofpercentagepointsthelenderaddstoorsubtractsfromtheindexratetodeterminetheinterestrateadjustments.Themarginisconstantthroughoutthelifeofthemortgageandisspecifiedinthepromissorynote.MaturitydateThedayonwhichtheoutstandingprincipal,interestandfeesonaloanmustallberepaid.MobilehomeAtypeofresidencethat’sbuiltuponawheeledchassisandcanbetransportedfromsitetosite.ModularhomeAfactory-builthomethat’serectedon-site,withtheappearanceandcharacteristicsofasite-builtresidence.MortgageAlegaldocumentgivingalenderalienonrealestatetosecurerepaymentofaloan.Mortgageloansgenerallyrunfrom10to30years,afterwhichtheloanisrequiredtobepaidoff.Alsocalleddeedoftrustand/orsecuritydeed.MortgageinsuranceForconventionalloans,insurancethatprotectsthelenderifyoudefaultonyourloan.Ifyourdownpaymentislessthan20%,mostlenderswillrequireyoutopaymortgageinsurance.Alsocalledprivatemortgageinsurance(PMI).MortgagepointsSee:PointsMortgagetypeGenerally,therearethreebasicmortgageprograms:FederalHousingAdministration(FHA)loans,DepartmentofVeteransAffairs(VA)loansandconventionalmortgageloans.VAloansareonlyofferedtoqualifyingveteransandsurvivingspouses,whileFHAloansareavailabletoallqualifyingborrowers.BothVAandFHA

loansareguaranteed/insuredbythefederalgovernment.Thisinsuranceprotectsthelender(nottheborrower)shouldtheborrowerdefaultandthelendersustainsaloss.Conventionalloansareavailabletoallqualifyingborrowersandarenotinsuredorguaranteedbythefederalgovernment.Multi-familyresidence(2to4units)Aresidentialpropertywith2to4individualhousingunits(duplex,triplexorquadplex).BacktotopNNegativeamortizationTheresultwhenmonthlypaymentsdon’tcoveralltheinterestdueontheloan.Theunpaidinterestisaddedtotheunpaidbalance,whichmeansthehomebuyerwilloweincreasinglymorethantheoriginalamountoftheloan.NewlineamountThesumoftheexistingcreditlineandtheamountofadditionalcreditrequested.NoclosingcostloanAloaninwhichtheborrowerisnotrequiredtopaycashout-of-pocketatclosingforthenormalclosingcosts.Thelendertypicallyincludestheclosingcostsintheprincipalbalanceorchargesahigherinterestratethanforaloanwithclosingcoststocovertheadvanceofclosingcosts.NonconformingloanSee:JumboloanNonowneroccupiedPropertiesinwhichtheownerdoesnotlive.NoteAwrittenagreementinwhichthesignerpromisestopaytoanamedpersonorcompanyaspecificsumofmoneyataspecifieddateorondemand.NoterateTheinterestratestatedinamortgagenote.NoticeofdefaultAformalwrittennoticetoaborrowerthatadefaulthasoccurredandthatlegalactionmaybetaken.BacktotopOOptionARMAtypeofadjustable-ratemortgage(ARM)thatofferstheborrowerachoiceof4monthlypaymentoptionstohelpprovidefinancialflexibilitytomanagepaymentsinrisingratemarketsandtakeadvantageoffallinginterestrates.OriginationThedatethattheproceedsofaloanaredisbursed.OriginationdateThedateonwhichaloanisfundedordisbursed.OriginationfeeAfeeimposedbyalendertocovercertainprocessingexpensesinconnectionwithmakingamortgageloan.Usuallyapercentageoftheamountloaned(often1%).Theoriginationfeeisstatedintheformofpoints.Seealso:PointsOwnerfinancingApropertypurchasetransactioninwhichthepropertysellerprovidesallorpartofthefinancing.Owner-occupiedApropertythattheowneroccupiesasaprincipalresidence.Backtotop

PPaymentcapAlimitonhowmuchamonthlypaymentcanincreaseatanyonetime.Someadjustable-ratemortgageshavepaymentcapsinadditiontoannual(orsemi-annual)interestratecapsandlifetimeinterestratecaps.Paymentcapsdon’tlimittheamountofinterestchargedandmaycausenegativeamortization.Seealso:InterestratecapPaymentchangedateThedatewhenanewmonthlypaymentamounttakeseffectonanadjustable-ratemortgage(ARM).Generally,thepaymentchangedateoccursinthemonthimmediatelyaftertheinterestrateadjustmentdate.Theborrowerisnotified30daysbeforethenewrateandpaymenttakeeffect.PayoffPaymentoftheoutstandingbalanceofaloaninfull.Also,theamountrequiredtopaytheoutstandingbalanceinfull.PerdieminterestTheamountofinterestthataccruesdailyonaloan.Thisiscalculatedbymultiplyingtheoutstandingloanbalancebytheannualrateofinterest,thendividingtheresultby365.PITIAnacronymforprincipal,interest,taxesandinsurance.Alsoreferredtoasthemonthlyhousingexpense.PointsAnamountpaidtothelender,typicallyatclosing,tolower(orbuydown)theinterestrate.Onediscountpointequalsonepercentagepointoftheloanamount.Forexample,2pointsona$100,000mortgagewouldcost$2,000.Negativepointsindicatetheamounttobecreditedatclosingtoreduceclosingcosts.Alsocalleddiscountpointsormortgagepoints.PreapprovalAlender’sconditionalagreementtolendaspecificamountofmoneytoahomebuyerunderaspecifiedsetofterms.PrearrangedrefinancingagreementAformalorinformalarrangementbetweenalenderandaborrowerwherethelenderagreestoofferspecialterms(suchasareductionintherateorclosingcosts)forafuturerefinancingasaninducementfortheborrowertoenterintotheoriginalmortgagetransaction.PreforeclosuresaleSee:ShortsalePrepaidexpensesTheexpensesthatareusuallypaidinadvance,suchasescrowsfortaxesandinsurance(whicharepaidatclosing).PrepaidinterestInterestcollectedatclosingofafirstmortgage,coveringtheperiodfromthedateofdisbursementtothestartofthenextpaymentperiod.PrepaymentAnamountpaidtoreducetheprincipalbalanceofaloanbeforetheprincipalisdue.PrepaymentpenaltyApenaltyassessedbysomelendersifaloanispaidoffbeforethespecifiedterm.Thisisalump-sumamountdueandpayableinadditiontotheloanbalance,andisusuallylimitedtotheearlyyearsofamortgage.Seealso:AccountterminationfeePrequalification

Theprocessofprovidingfinancialandotherinformation(suchasemploymenthistoryandproposedcollateral)byaprospectiveborrowerinorderforthelendertopreliminarilyestimatehowmuchtheborrowermayobtainforthepurchaseofahome.Aprequalificationisnotacommitmenttolend.PrimerateTheinterestratethatbankschargetheirbestcustomerswhenlendingthemmoney.TheU.S.PrimeRate,aspublisheddailybyTheWallStreetJournal,isbasedonasurveyoftheprimeratesofthe10largestbanksintheUnitedStates.TheU.S.PrimeRateisusedbysomefinancialinstitutionstocalculatevariableinterestratesforcreditcards.ChangesintheU.S.PrimeRateinfluencechangesinotherrates,includingmortgageinterestrates.Principal&interestTheprincipalistheamountofmoneyborrowedonaloan.Theinterestisthechargepaidforborrowingmoney.Principalandinterestaccountforthemajorityofyourmortgagepayment,whichmayalsoincludeescrowpaymentsforpropertytaxes,homeownersinsurance,mortgageinsuranceandanyothercoststhatarepaidmonthly,orfeesthatmaycomedue.PrincipalbalanceTheunpaidportionoftheloanamount.Theprincipalbalancedoesnotincludeinterestoranyothercharges.PrincipalpaymentPortionofyourmonthlypaymentthatreducestheprincipalbalanceofahomeloan.Thistermalsoreferstoprepaymentsyoumaketotheprincipalbalance.Privatemortgageinsurance(PMI)See:MortgageinsuranceProcessingfeeAfeechargedtocovertheadministrativecostsofprocessingaloanrequest.PromissorynoteAwrittenpromisetorepayaspecifiedamountoveraspecifiedperiodoftime.PurchaseagreementAwrittencontractsignedbythebuyerandsellerstatingthetermsandconditionsunderwhichapropertywillbesold.BacktotopQQualifyingratiosCalculationsthatareusedtodeterminewhetheraborrowercanqualifyforamortgage.Theyconsistof2separatecalculations:ahousingexpenseasapercentofincomeandtotaldebtobligationsasapercentofincome.BacktotopRRateTheamountofinterestonaloan,expressedasapercentage.RatecapSee:InterestratecapRatelockAcommitmentissuedbyalendertoaborrowerguaranteeingaspecificinterestrateforaspecifiedperiodoftime.Ratelockperiodsareforafixednumberofdays,andratelockexpirationoccurswhenthatperiodhaspassed,subjectingtheinterestrateontheloantomarketfluctuationssincethedateoftheinitialratelock.Whenaratelockexpires,youwillneedtocontactyourlendingspecialisttoestablishanewratelockpriortoclosingyourloan.Ratelockexpiration

Acommitmentissuedbyalendertoaborrowerguaranteeingaspecificinterestrateforaspecifiedperiodoftime.Ratelockperiodsareforafixednumberofdays,andratelockexpirationoccurswhenthatperiodhaspassed,subjectingtheinterestrateontheloantomarketfluctuationssincethedateoftheinitialratelock.Whenaratelockexpires,youwillneedtocontactyourlendingspecialisttoestablishanewratelockpriortoclosingyourloan.RatereductionoptionAprovisioninafixed-ratemortgagethatgivestheborrowertheoptiontoreducetheinterestrateatalaterdatewithouthavingtorefinance.Exercisingaratereductionoptiontypicallydoesnotrequirerequalifyingfortheloan.RealEstateSettlementProceduresAct(RESPA)Aconsumerprotectionlawthat,amongotherthings,requiresadvancedisclosureofsettlementcoststohomebuyersandsellers,prohibitscertaintypesofreferralandotherfees,setsrulesforescrowaccountsandrequiresnoticetoborrowerswhenservicingofahomeloanistransferred.ReamortizeTotaketheremainingbalanceofamortgageloanandestablishanewperiodofamortizationafterwhichtheprincipalbalancewillbezero.Typicallyusedaftertheendofthetermofaninterest-onlyloan.RecorderAchargeforapublicofficial(typicallyaRegistrarofDeedsorCountyClerk)notinginthepublicrecordthetermsofalegaldocumentaffectingtitletorealpropertysuchasadeed,asecurityinstrument,asatisfactionofmortgageoranextensionofmortgage.RecordingAchargeforapublicofficial(typicallyaRegistrarofDeedsorCountyClerk)notinginthepublicrecordthetermsofalegaldocumentaffectingtitletorealpropertysuchasadeed,asecurityinstrument,asatisfactionofmortgageoranextensionofmortgage.RecordingfeeAchargeforapublicofficial(typicallyaRegistrarofDeedsorCountyClerk)notinginthepublicrecordthetermsofalegaldocumentaffectingtitletorealpropertysuchasadeed,asecurityinstrument,asatisfactionofmortgageoranextensionofmortgage.ReduceddocumentationAmethodusedtodetermineincomewhenqualifyingaborrowerforaloan.Borrower(s)providetheirincome,howevernoverificationdocumentationistypicallyrequired.RefinancePayingoffyourexistingloanwiththeproceedsfromanewloan,generallyusingthesamepropertyascollateral,inordertotakeadvantageoflowermonthlypayments,lowerinterestratesorsaveonfinancingcosts.RehabilitationloanAfirstmortgagethatenablesborrowerstopurchaseorrefinanceandrehabilitatehomes.Withthismortgageproduct,borrowerscanqualifyforloanamountsbasedontheas-completedvalueoftheproperty,uptothemaximumloanlimits.RepaymentperiodThetimeyouhavetofullyrepayyouroutstandingbalance,accordingtoyourpaymentterms.Inahomeequitylineofcredit,forexample,therepaymentperiod(typically20years)istheloantermthatfollowsthedrawperiod(typically10years).RescissionThecancellationofacontract.Incertainrealestate-securedtransactionsthatinvolvetherefinanceofaprimaryresidence,applicantshave3businessdaystocancelthetransaction.Reserves

Theamountofsavings,separatefromthedownpayment,thatahomebuyersetsasideincaseofunforeseeneventsoremergencies.Duringtheloanapprovalprocess,manylendersrequirereserves(typicallytheequivalentof2monthlymortgagepayments)tobeverified.RightoffirstrefusalAprovisioninanagreementthatrequirestheownerofapropertytogiveanotherpartythefirstopportunitytopurchaseorleasethepropertybeforeheorsheoffersitforsaleorleasetoothers.RuralhousingloanAloanofferedbytheRuralHousingService(RHS),anagencywithintheDepartmentofAgriculture.TheRHSprovidesfinancingtofarmersandotherqualifiedborrowersbuyingpropertyinruralareaswhoareunabletoobtainloanselsewhere.FundsareborrowedfromtheU.S.Treasury.Seealso:GovernmentloanRuralHousingService(RHS)AloanofferedbytheRuralHousingService(RHS),anagencywithintheDepartmentofAgriculture.TheRHSprovidesfinancingtofarmersandotherqualifiedborrowersbuyingpropertyinruralareaswhoareunabletoobtainloanselsewhere.FundsareborrowedfromtheU.S.Treasury.Seealso:GovernmentloanBacktotopSSecondhomeApropertyoccupiedpart-timebyapersoninadditiontohisorherprimaryresidence.SecuredloansLoansforwhichtheborrowergivesthelenderalienonpropertysuchasanautomobile,boat,otherpersonalpropertyorrealestatethatwillserveascollateralfortheloan.SecurityThepropertythatwillbepledgedascollateralforaloan.Iftheborrowerdefaults,thelendercansellthecollateraltosatisfythedebt.SettlementThecompletionofaproperty’ssaleorpurchase,orthecompletionofallstepsnecessarytoreceivetheproceedsof(andcreateanobligationtorepay)aloan.Seealso:Closing.SettlementagentApersonorentitythatconductsthesettlementtotransfertitleofthepropertyandtocloseonthemortgageloan.Maybeanattorney,atitleinsurer,atitleagentoranescrowagent.SettlementcostsSee:ClosingcostsShortsaleAcommonlyusedalternativetoaforeclosure.Ifahomeownercannolongeraffordtomakemortgagepaymentsandtheirhomeisworthlessthantheyowe,ashortsaleallowsthemtosellthehometopayoffthemortgage.Inashortsale,thelenderagreestoacceptanamountlessthanisactuallyowedontheloan,basedonashowingoffinancialhardship.Single-familyresidenceAdetachedindividualhousingunit.Thepropertysharesnocommongroundwithneighboringpropertiesandsharesnowallorroof,butcanbepartofaplannedunitdevelopment(PUD).StartrateThestartinginterestrateforanadjustable-ratemortgage(ARM)loanorvariable-ratehomeequitylineofcredit.Alsoknownasaninitialrateorintrorate.Itprovideslowerinterestandlowermonthlypaymentsatthebeginningbutmayadjustatthenextadjustmentperiod.SubordinatefinancingAnymortgageorotherlienthathasaprioritylowerthanthatofthefirstmortgage.Thesubordinateloanhasaclaimtopaymentinaforeclosureonlyafterthefirstmortgageispaid.

SwingloanSee:BridgeloanBacktotopTTermThenumberofyearsitwilltaketopayoffaloan.Theloantermisusedtodeterminethepaymentamount,repaymentscheduleandtotalinterestpaidoverthelifeoftheloan.Third-partyfeesFeeschargedforservicesrenderedbypartiesotherthantheborrowerorthelender.Suchfeesmayincludeappraisal,creditreport,titleandfloodcertifications.TitleWrittenevidenceofownershipinproperty.TitlecompanyTheagencythatwillinvestigateaproperty’stitle(ordeed)fordiscrepanciesorundiscoveredliensandthatwillissuetitleinsurancetothelenderafterthetitleisdeemedclear.TitleinsuranceInsurancethatprotectsaninterestedparty,eithertheownerorthelender,againstissuesthatwouldaffectlegalownershipoftheproperty.TitlesearchAnexaminationofrecordsusedtodeterminethelegalownershipofpropertyandallliensandencumbrancesonit.Usuallyperformedbyatitlecompanyorattorney.TotalexpenseratioSee:Debt-to-incomeratioTransactionfeeThefeethatmaybechargedeachtimeyoudrawonyourcreditline.TreasuryindexAnindexthatisusedtodetermineinterestratechangesforcertainadjustable-ratemortgage(ARM)plans.ItisbasedontheresultsofauctionsthattheU.S.TreasuryholdsforitsTreasurybillsandsecuritiesorisderivedfromtheU.S.Treasury’sdailyyieldcurve,whichisbasedontheclosingmarketbidyieldsonactivelytradedTreasurysecuritiesintheover-the-countermarket.Seealso:PrimerateTrusteeAfiduciarythatholdsorcontrolspropertyforthebenefitofanother.TruthinLendingActAfederallawrequiringdisclosureofcredittermsusingastandardformat.Thisisintendedtofacilitatecomparisonsbetweenthelendingtermsofdifferentfinancialinstitutions.ReadabouttheTruthinLendingActontheDept.oftheTreasurywebsiteBacktotopUUnderwriterThepersonwhoapprovesordeniesahomeloan,basedonthelender’sunderwritingandapprovalcriteria.UnderwritingThelender’sprocessofdecidingwhethertomakealoantoapotentialborrowerbasedoncredit,employment,assetsandotherfactors,andthematchingofthisrisktoanappropriaterate,termandloanamount.UniformResidentialLoanApplication(1003)ThestandardloanapplicationformpublishedbytheFederalNationalMortgageAssociation(FannieMae)andusedbymostlenders.

UnsecuredlinesofcreditTypicallyusedwhenreferringtoaloanoralineofcredit(unsecuredloan,unsecuredlineofcredit)thatisnotbackedbycollateral.UnsecuredloanTypicallyusedwhenreferringtoaloanoralineofcredit(unsecuredloan,unsecuredlineofcredit)thatisnotbackedbycollateral.UpfrontcostsThecostsyoumustpaywhenapplyingforaloan.Typicallytheseincludeloanapplicationfees.Somelendersrequiresomeofyourclosingcostsalsobepaidwhenyouapply.BacktotopVVAloanAmortgagethatisguaranteedbytheDepartmentofVeteransAffairs(VA)forqualifiedveteransofU.S.militaryforces.Seealso:GovernmentloanVacationhomeAvacationhomeisasingle-familypropertythattheborroweroccupiesinadditiontohisorherprimaryresidence.Thepropertycannotbeconsideredincome-producingandmustnotbepartofamandatoryrentalpool,butoccasionallymayberentedtofriendsandrelatives.Whenpropertyisclassifiedasasecondhome,rentalincomemaynotbeusedtoqualifytheapplicant.A2-to4-unitpropertyisnoteligibleforsecondhomestatus.Alsoknownassecondhome.VariablerateAninterestratethatmayfluctuateorchangeperiodically,ofteninrelationtoanindexsuchastheprimerateorothercriteria.Paymentsmayincreaseordecreaseaccordingly.Variable-ratemonthlyminimumpaymentTheminimumamountyouwillneedtopayeachmonthonyourhomeequitylineofcredit,orHELOC(doesnotincludeanypaymentsfortheFixed-RateLoanPaymentOption).Thepaymentamountincludesbothprincipalandinterest(minimumof$100).Themonthlyrequiredpaymentmayvaryeachmonthandisbasedonyouroutstandingloanbalanceandfluctuatinginterestrate.Ingeneral,thispaymentisintendedtorepayyourloanbalanceinsubstantiallyequalprincipalandinterestinstallmentsovertheremainingloanterm,basedonthebalanceandrateinformationatthetimeofeachmonthlycalculation.BacktotopWW-2Awageandtaxstatementprovidedbyyouremployerannually.TheW-2formdetailsyourincomeandthevariouslocalandfederaltaxeswithheldfromyourincome.ItisprovidedtotheIRSalongwithyourtaxreturn.Walk-throughAfinalinspectionshortlybeforesettlementtomakesurethepropertyisinthesameconditionthatitwasatthetimetheoffercontractwaswritten.What-ifanalysisAnaffordabilityanalysisthatisbasedonawhat-ifscenario.Awhat-ifanalysisisusefulifyoudonothavecompletedataorifyouwanttoexploretheeffectofvariouschangestoyourincome,liabilities,oravailablefundsortothequalifyingratiosordownpaymentexpensesthatareusedintheanalysis.Whereisthisfound?YourapplicationnumberislistedinyourWelcomeLetterorotherbankcommunicationsregardingthisapplication.Ifyouhaven’treceivedyourWelcomeLetterorneedhelpwithyourapplicationnumber,pleasecall1.800.269.3084.Whydoweaskforthis?

Whenyoucreateonlinecredentials,wetakeextensiveprecautionstoprotectyourinformationandverifyyouridentity.YourSocialSecuritynumberallowsustoconfirmyouridentity.WindstorminsuranceThiscoverageistypicallyrequiredincoastalareasandpaysforpropertydamageresultingfromawindstorm.Likefloodandearthquakecoverage,windstorminsurancecoversdamagetothedwellingand,insomecases,personalpropertyandlivingexpensesifthedwellingisuninhabitable.Somestatesoffermarketassistanceprogramsorjointunderwritingassociationstohelphomeownersfindcoverageinareaswherecoverageisscarce.WiretransferAtransferofmoneyfromoneperson’sbanktoanotherperson’sbankaccount,eitherdomesticallyorinternationally.BacktotopXNoentriesforthisletter.BacktotopYYear-endstatementThereportshowshowmuchwaspaidininterestduringtheyear,aswellastheremainingmortgageloanbalanceattheendoftheyear.Ifthebankhasanimpoundaccountforyou,itwillalsoshowhowmuchwaspaidandreservedinpropertytaxes.Ifthebankdoesnothaveapropertytaximpoundaccount,thentaxdetailsarenotdisplayedonthereport.BacktotopZNoentriesforthisletter.

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Steps to aSuccessful Signing

v Negotiation/Acceptanceü Identify Signing Company

RequirementsüAvailabilityüAgreement

Steps to aSuccessful SigningvPreparation/Signing Expectations

ØConfirm with Signer§ Communicate Stipulations§ Go over time allotment for signing§ Environmental Requirements§ Your Contact Information in Case of

Changes§ Notary Requirements

üName ConsistencyüLanguage/Communication

v Preparation of PackageØ If allowed to re-organize package: CD

Closing Disclosure, HUD, Note, Deed of Trust, Mortgage, TIL (Truth in Lending), 1003 (Loan Application), RTC (Right to Cancel)

v Flag Documents Requiring Notarizationv Review Closing instructions for NSA

Ø Ink color (Blue or Black only), copy of ID, insurance info, funding

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v Travel§ Transportation

ØGasØServiced

§ DirectionsØGPSØMapQuest or GoogleØDirections /Landmarks from Signer

§ Timing

v Manage Appointment§ Introductions§ Evaluate Signing Environment§ Identify/ask for workspace area for signing§ Organize Workspace§ Collect IDs§ Communicate Your Role§ Review Instructions from Title Company§ Directions for handling the Documents

v Negotiation/Acceptance (get the job)v Preparation for the Assignmentv Travelv Manage Signing Environmentv Execution of Signingv Wrap/Reviewv Completion

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v Execution§ Introduce the Documents§ Point out designated Signature/Initial

lines§ Address Questions Appropriately§ Beware of inappropriate Notary request§ Be prepared for exception

v Wrap up/Review§ Recheck documents§ Attach Envelope with Check

(write check enclosed)§ Tell Signer next step

v Completion§ Communicate completion as

instructed§ Fax-backs if required (TurboScan)§ Timely courier drop (as soon as

possible – get app FedEx or UPS)§ Invoicing (Notary Gadget)§ Recordkeeping/Reconciling

10/24/17

Conclusion

• Begin with a process that promotes proactive steps from acceptance to completion which include: preparation, organization, control and follow up.

• Identify and have available resources and alternatives that can keep a signing on track.

• Know Florida Notary Laws• Communicate and present yourself as a

professional to keep Title and Signing Services calling you.

Contact InformationEmail: notary@cynanotary.com

Cell: 954-464-7253Office: 954-977-9905, ext. 101

7200 W. Commercial Blvd, Suite 203

Lauderhill, FL 33319

10/24/17

When Appointment is Accepted´ Call the borrower ASAP and confirm the following

information:´ Time

´ Date

´ Location

´ Best Contact Info´ Copy of Their IDs

´ Flexibility (if docs become late)

´ Verify who needs to be at the signing

´ Ask if signers are married´ Most states require the spouse to sign some docs even if they

are not on the loan

All Closing Instructions are on per company basis´ Borrower should provide the 1st payment check

´ Amount will be disclosed before closing (No Personal Checks)

´ This check is to be returned with the signed closing documents

´ If borrower fails to provide this Do Not Close and contact me immediately

ID requirements

´ If no copy provided by signer make sure to take a photocopy or take a picture (with digital camera or smart phone) of a government issued photo ID and a second ID for each borrower

´ Email images to: orders@cynanotary.com or fax to: 954-653-3860

´ Examples of government issued photo ID’s accepted below (cannot be expired):´ Driver License

´ Resident Alien/Alien Registration Card (Green Card)

´ Passport

´ Military ID

´ Non-Us Citizens must provide 2 government issued photo ID’s per signer´ Second ID: copy of SS card, voters ID, insurance card does not have to have

a photo

´ Do not accept Credit Card under any circummstance

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Print Copy for borrower unless specified by Title´ Print 1 copy of all docs to be signed and 1 copy for

the borrower´ Unless Title states otherwise, which will be noted on order

´ All docs should be signed in BLUE ink, unless noted

´ Paper size should be chosen by PDF size or legal size is a good default

´ With Cynanotary membership you print at Office Depot 2-1/2¢ per copy or Staples 3¢ per copy

State Witness requirements

´ We require a witness or multiple witnesses on the Mortgage/Deed of Trust in some states. Please ensure there will be a witness(es) present if the property is in the following states:

´ Connecticut (CT): 2 witnesses are required. One can be the Notary Signing Agent

´ Florida (FL): 2 witnesses are required. One can be the Notary Signing Agent

(QCD same as above)

´ Georgia (GA): 1 witness is required, Cannot be the Notary Signing Agent

´ Louisiana (LA): 2 witnesses are required. Cannot be the Notary Signing Agent

´ South Carolina (SC): 2 witnesses required. One can be the Notary Signing Agent (The witness other than the Notary Signing Agent must also witness the Notaries signature of the Acknowledgement/Jurat Section of the Deed of Trust (Mortgage) even if there is no witness signature line given

´ Vermont (VT): 1 witness is required, Cannot be the notary Signing Agent

When Documents are Late

´ Call the borrower immediately once you are positive you cannot make the scheduled time, before you are late.

´ Let them know that you will “Call them with any updates but for now do not proceed to the closing location until they hear from you.”

´ All closings that are not met due to late docs will be rescheduled by Title.

´ Do not say the closing is canceled´ Go about your day but keep the borrower in the loop

´ Let Closing Service know if you ever reach a point where you could not set anything up due to your schedule.

10/24/17

When You are Late

´ Call the borrower immediately if you know you will be late arriving to a closing before the closing appointment

´ Calling After Your Scheduled Appointment is Not Acceptable

´ If you are stuck in a prior appointment, excuse yourself to make a quick phone call to us (VERY IMPORTANT) or shoot us a quick email notary@cynanotary.com

´ Never, Never, Never bad mouth Lender, Title, or Closing Service. Just Be-Positive No Matter What.

When Docs Arrive´ You will receive the Closing Package including:´ A Final 1003 loan application´ 3 Copies of the CD (Closing Disclosure) or HUD

´ Please note the HUD/VA Addendum, Form 92900A 2nd page has 2 signature sections. This document also requires initials on pages 1 and 4

´ Affidavits, Note (Do Not Notarize only Signed by Borrower Only)

´ Mortgage Payoff (must be signed by the borrower(s))´ Please be sure the entire Payoff prints and includes a

signature line(s) on page two for the borrower(s) signatures(s).

´ Please pay close attention to the Uniform Residential Loan Application (1003), as it requires multiple signatures, one of which is slightly toward the top of the first; do initial unless there is a specific place or request.

When Docs Arrive Cont.

´ The password to open the docs will be sent via a separate email. (Please note there will not be any CAPITAL letters in the password)

´ Do not have borrower sign or initial any documents that do not require them

´ Please make sure the notary seal/stamp is legible and clear for our scans

´ You will receive a FedEx Return Label – Please make every effort possible to get final signed closing package to FedEx drop box ON SAME DAY THEY ARE SIGNED

10/24/17

When Docs Arrive Cont.´ A copy of all documents has been provided to

the borrower(s) If any questions arise at closing table, please have the borrower contact: ´ Loan officer at 866-743-4211,

´ after hours Money 877-777-7777

´ Please refrain from using staples. (If staples are used $10 will be deducted from your fee)

When at the Closing

´ Please have borrowers sign & initial where needed, all questions should be addressed with 1st Alliance

´ PLEASE DO NOT GIVE YOUR OPINION, LEGAL ADVICE OR MAKE any COMMENTS ABOUT THE LENDER OR THE TITLE COMPANY. You are their representative and negative feedback could cause you to lose future business

´ NO FORM SHOULD BE LEFT UNSIGNED that requires borrower’s signature WITHOUT GETTING APPROVAL from someone important at 800-Helpme

When Closing is Complete

´ Go to orders.cynanotary.com immediately and complete the closing report. This will prevent phone calls to you later asking you to do this and also generate an invoice for you.

10/24/17

Important Contact Information

´ Emergency Contact Only (if no one can be reached and your voicemails are not returned): ´ I need help at 999-999-0000

10/25/17

Workshop Format

´Introduction´Presentation´Questions´Evaluations

Introduction

´Proper´Planning´Prevents´Poor´Performance

Pre-Closing Activities

´Receive the Appointment

´Confirm the Appointment

´Print the Documents

´Review the Documents

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Closing Professionalism

´Dressing for Success

´Promptness

´Parking Etiquette

´Meeting the Borrower

Identifying the Borrower

´Obtain Identification

Driver’s License

Record Information

´Record information in your journal.

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Setting the Stage

´NSA Introduction

• Name• Notary Badge• Business Card• Purpose• Independent

Contractor

• Signature Requirements

• Borrower’s Copy• Journal (NotaryAct)

The Begin Closing

´Administering Verbal Declarations´Acknowledgment´Jurat

Closing (cont.)

´Presenting Loan Documents at the Table

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Closing (cont.)

´Handling Challenging Situations

Closing Completion

´Loan Signing Wrap Up

Post-Closing Duties

´Provide Closing Status´Follow Fax-back

Procedures´Return Documents

10/25/17

Additional Responsibilities

´When Lender Is in Error

´When Notary Is in Error

Summary

Thank You!

´Questions?´Presenter contact info:

CynANotary Team Memberwww.cynanotary.com

954-977-9905

10/25/17

Now go close some loans

GETTING STARTED� Written Business Plan

�Define what you want your business to be�Research marketplace & competition�Develop your niche

� Written Budget�Start – up costs�Operating expenses

Cynanotary, LLC

BUSINESS NAME� Establishes Your Brand

�Use whenever, wherever possible

� Should be a registered – DBA

� Protect it!

Cynanotary, LLC

GOVERNMENTAL REQUIREMENTS� EIN Number - Tax ID Number

� Issued by IRS�Forms available online @ IRS.gov

� Business Licenses�State�County�City

Cynanotary, LLC

Notary Tools� Notary Commission

�Surety Bond�E & O Insurance

� Education – Basic & Signing Agent� Notary Seal� Paper Journal � NotaryAct Electronic Journal� Inkless Thumb-printer� Loose Certificates� Business Cards

Cynanotary, LLC

BUSINESS ASSETS� Computers

� Desktop� Laptop� Tablets

� Printer/ Fax/ Copier� Page Separator

Cynanotary, LLC

Business Assets (cont.)

� Software programs/Phone Apps� Rescission calendar online� UPS or FedEx (List of drop sites) �Notary Gadget / Notary Assist �(Critical for Scheduling/Appointments)� TurboScan� CamCard

Cynanotary, LLC

OFFICE SUPPLIES� Cynanotary Membership� Signing pens – 6 blue & 6 black� Paper

� Letter – 8.5 x 11� Legal – 8.5 x 14�Envelopes

� Binder clips� Everything Else! (Shopping Trip!)�Alcohol Wipes

Cynanotary, LLC

SHIPPING SUPPLIES� FedEx & UPS envelopes� Address labels� Get Shipping Accounts also

Cynanotary, LLC

OFFICE� Dedicated space!!!!� Internet (High Internet) � Organized

�Desk�File Cabinets�Shelves�Good chair!

Cynanotary, LLC

IMPORTANT EXTRAS� Vehicle

� Must be clean!� Keep up with maintenance� Have adequate insurance

� Mentors - Resources� Professional Associations � Affiliate organizations� Experienced SAs – (Mentor Crystal)� Online resources – social media

� Tax and Legal Advisors

Cynanotary, LLC

Don’t Forget: SAFETY� Flashlight� GPS – Maps� Let someone know where you’ll

be / when� Use the buddy system� Florida is a Witness State

BE SMART!!

Cynanotary, LLC

CertificateofP

hotocopy

Firsto

fallyoutheNotary

akethecopy

10/25/17

1.NameofCountyBroward

2.DateofNotarizationBroward

8th December 2017

3.DescriptionofOriginalDocument

Broward

8th December 2017

B.A.DegreefromUniversityofFlorida

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4.NameofDocumentCustodian

Broward

8th December 2017

JaneDoe

5.SignatureofNotaryBroward

8th December 2017

JaneDoe

Cynthia Alexander

6.NameofNotaryBroward

8th December 2017

JaneDoe

Cynthia Alexander

CynthiaAlexander

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7.NotarySealImprintBroward

8th December 2017

JaneDoe

Cynthia Alexander

CynthiaAlexander

8.Custodian’sAddressBroward

8th December 2017

JaneDoe

Cynthia Alexander

CynthiaAlexander

123N.Blvd,Lauderdale,FL

9.Capacity/TitleClaimedbyCustodian

Broward

8th December 2017

JaneDoe

Cynthia Alexander

CynthiaAlexander

123N.Blvd,Lauderdale,FLIndividual

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10.DocumentDateBroward

8th December 2017

JaneDoe

Cynthia Alexander

CynthiaAlexander

10/13/17

11.NumberofPagesBroward

8th December 2017

JaneDoe

Cynthia Alexander

CynthiaAlexander

10/13/17 2

12.Signer(s)orIssuingAgencyBroward

8th December 2017

JaneDoe

Cynthia Alexander

CynthiaAlexander

10/13/17 2UniversityofFlorida

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13.AdditionalPertinentInformation

Broward

8th December 2017

JaneDoe

Cynthia Alexander

CynthiaAlexander

10/13/17 2UniversityofFloridaOriginalDocument9”x12”

14.RightThumbprintofSigner

Broward

8th December 2017

JaneDoe

Cynthia Alexander

CynthiaAlexander

10/13/17 2UniversityofFloridaOriginalDocument9”x12”

New Loan Forms- Loan Estimate & Closing Disclosure Effective Oct 3, 2015

FIELDCHOICE NOTARY NOTICE- SEPT 2015 Hello FieldChoice Notaries,

As most of you are aware, there will be a big change in two of the key forms used in the current loan packages for most residential transactions per the CFPB guidelines, effective October 3, 2015.

How will this affect my loan signings? 1. Lenders are to provide these new forms to the borrower(s) no later than three business days

before the signing date known as the waiting period. 2. Loans that require the new forms are purchase money loans, refinances, loans secured by 25

acres or less, loans secured by vacant-land, and timeshare loans. 3. Loans that are exempted from the new forms are reverse mortgages, HELOCs, mobile home only

loans, and creditors who originate less than 5 loans per calendar year. a. Reverse Mortgages and HELOCs will still use the TIL and GFE

LOAN ESTIMATE- This form is a three page document that contains the cost and risk of the loan the borrower is applying for.

CLOSING DISCLOSURE- This form is a two - five page document and can come in three variations depending on the type of loan transaction.

Closing Disclosure is a combined form disclosing both buyer and seller costs Seller Closing Disclosure is only itemizing the sellers’ costs and not the buyers’ costs Non-Seller Closing Disclosure is for transactions not involving the a seller, typically a

Refinance

4. If borrowers have any questions at the table, including the Owners Title insurance that is listed as optional, you should refer the borrower to the lender contact shown in the contact information section on page 5 of the Closing Disclosure.

5. If there are any changes to the loan’s APR, loan product, or prepayment penalties the lender must ensure the Closing Disclosure is revised and a new waiting period is carried out.

Please familiarize yourself with the attached samples of these forms and keep them as a reference for signings. You may also want to educate yourself for questions that may arise at your signings through resources provided by the CFPB and the NNA. The CFBP has several resources on their website at http://www.consumerfinance.gov/regulatory-implementation/tila-respa/

We wish you much success during your transition and are always here to assist our notary team! FieldChoice

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