| Rule Number: |
18P020 |
| Title: |
Form, Content & Timing of Residential Real Estate Mortgage Loan Commitment Letters. |
|
Type:
|
Standard |
|
Status:
|
Adopted |
| Agency: |
Department of Financial Regulation
|
| Legal Authority: |
9 V.S.A. ยง 103. |
| Summary:
| The proposed changes to the regulation: 1. Make the definitions more consistent with state and federal statutes and regulations; 2. Update the content of the standard commitment letter; 3. Create an optional short form commitment letter that lenders may use with the Closing Disclosure required by federal Regulation z (12 CFR Part 1026); 4. Specify the content for reverse mortgage loan commitment letters; 5. Clarify that commitment letters may be signed and delivered electronically pursuant to the Vermont Electronic Transactions Act; 6. Require that the commitment letter be delivered at least 3 business days prior to the loan closing; 7. Provide additional clarification about delivering the commitment letter less than 3 business days prior to the loan closing in the case of a borrower's bona fide personal financial emergency. |
| Persons Affected:
| Banks, credit unions, non-bank residential mortgage lenders, mortgage brokers, mortgage loan originators, the Department of Financial Regulation, and borrowers. |
| Economic Impact:
| Lenders that are following the current regulation and choose to use the standard commitment letter should not incur any additional costs. Lenders that do not already include the required commitment letter elements will incur some reprograming costs to bring their commitment letter into compliance with the revised regulation. Lenders that use the short form commitment letter may incur some initial programing costs, but should see a reduction in mailing costs and should see a reduction in compliance costs because it will reduce the possibility that the terms of the commitment letter will be inconsistent with the Closing Disclosure required by federal Regulation Z (12 CFR Part 1026). Lenders may see a reduction in costs when borrowers elect to receive the commitment letter electronically. |
| Posting date: |
May 23,2018 |
