How to Issue a Redisclosure / Change of Circumstance Package?

Managing a “Change of Circumstance” (COC) and send a “Redisclosure” package to borrowers are always a topic of discussion for lenders.

Due to the fact that lenders are held responsible for the fees quoted through a Loan Estimate form and the dynamic nature of the origination process, effectively managing the disclosure and redisclosure processes has created a significant amount of questions and challenges for the mortgage industry.  We created the following guidelines for these COC and Redisclosure situations.  

  1. Knowing the triggers

    1. Lock events

      1. Float to lock,

      2. Extension, relock and repricing due to pricing parameters such as appraisal value change

      3. Secondary desk will get a request to lock email, and informs the disclosure desk

    2. Fee or APR changes

      1. APR changing more than 1/8 visual indicator in Summary panel

      2. Visual “i” indicators next to each fee line for any fee changes from disclosed amount

    3. Other events

      1. adding a co-borrower

      2. adding a titled-only spouse

      3. Other loan data change that may affect pricing or part of audit log

  2. Disclosure desk staff or processors - COC data update in LP

    1. Go into Disclosure tab to review and update fees

    2. Update “Disclosed amount” column to record fee amounts what’s disclosed to borrower. Revised fees will be shown in the COC form when there is a difference between “Disclosed amount” and actual fee amount to the left

    3. Use "Revisions" tab to document change reason

  3. Disclosure desk staff or processors - sending a COC package

    1. Using a doc vendor

      1. Go to Actions, Document Disclosures, select a doc vendor and send LE Redisclosure package

      2. Uncheck e-Sign to preview the package

      3. Check e-Sign flag when ready to send package out to borrower(s). It will auto transfer fees disclosed in Disclosures / Cost detail screen to the “Disclosed Amount” column

      4. Record redisclosure date in Critical Dates section

    2. Using LP’s Print forms section

      1. Preview COC form/package in the Print forms section

      2. Send COC form/package via email or e-Sign

      3. Record re-disclosure date in Critical Dates section

 This area is an evolving area that we constantly work with our clients to improve and to automate so they can disclose confidently with a process that’s both robust, efficient and accurate. Please contact your AE for any suggestions so we can incorporate them into our designs.

Please keep in mind that these are merely guidelines in using LendingPad. They are not legal or compliance advice. You should always consult your legal resources or compliance officer in defining your own process.