Mortgage Lending: § 1024.20 List of homeownership counseling organizations.
(a) Provision of list.
(a) Provision of list.
(a) Servicing disclosure statement. Within three days (excluding legal public holidays, Saturdays, and Sundays) after a person applies for a reverse mortgage transaction, the lender, mortgage broker who anticipates using table funding, or dealer in a first-lien dealer loan shall provide to the person a servicing disclosure statement that states whether the servicing of the mortgage loan may be assigned, sold, or transferred to any other person at any time. Appendix MS-1 of this part contains a model form for the disclosures required under this paragraph (a).
The following are instructions for completing the HUD-1 settlement statement, required under section 4 of RESPA and 12 C.F.R. part 1024 (Regulation X) of the Bureau of Consumer Financial Protection (Bureau) regulations. This form is to be used as a statement of actual charges and adjustments paid by the borrower and the seller, to be given to the parties in connection with the settlement. The instructions for completion of the HUD-1 are primarily for the benefit of the settlement agents who prepare the statements and need not be transmitted to the parties as an integral part of the HUD-1.
The following illustrations provide additional guidance on the meaning and coverage of the provisions of RESPA. Other provisions of Federal or state law may also be applicable to the practices and payments discussed in the following illustrations.
The following are instructions for completing the GFE required under section 5 of RESPA and 12 C.F.R. § 1024.7 of the Bureau regulations. The standardized form set forth in this Appendix is the required GFE form and must be provided exactly as specified; provided, however, preparers may replace HUD’s OMB approval number listed on the form with the Bureau’s OMB approval number when they reproduce the GFE form.
Affiliated Business Arrangement Disclosure Statement Format Notice
To: ________________________________________
From:_______________________________________
(Entity Making Statement)
Property:___________________________________
Date:_______________________________________
[Sample language; use business stationery or similar heading]
[Date]
SERVICING DISCLOSURE STATEMENT NOTICE TO FIRST LIEN MORTGAGE LOAN APPLICANTS: THE RIGHT TO COLLECT YOUR MORTGAGE LOAN PAYMENTS MAY BE TRANSFERRED
Title 12—Banks and Banking
* * *
Chapter X—Bureau of Consumer Financial Protection
* * *
Part 1024—Real Estate Settlement Procedures Act (Regulation X)
* * *
Supplement I to Part 1024—Official Bureau Interpretations
AUTHORITY: 12 U.S.C. §§ 2603–2605, 2607, 2609, 2617, 5512, 5532, 5581.
Section 1024.5 Coverage of RESPA
5(c) Relation to State laws.
Paragraph 5(c)(1).
[Reserved.]
Section 1024.17 Escrow Accounts
17(k) Timely payments.
17(k)(5) Timely payment of hazard insurance.
17(k)(5)(ii) Inability to disburse funds.
17(k)(5)(ii)(A) When inability exists.
* * *
Section 1024.33—Mortgage Servicing Transfers
33(a) Servicing disclosure statement.
Yet another example of a failure to provide all information in a consumer’s file (albeit perhaps difficult to privately redress) is Trans Union policy of not including information from the U.S.
Consumer reports show the present status of a consumer’s file, and do not disclose the information that may have been provided to a user in the past. An important issue is whether CRAs are in fact required to disclose the content of such prior reports, because it is the prior reports that form the basis of a user’s adverse action.
The disclosure right is limited to information in the CRA’s files “on the consumer.”523 The consumer has no right to information on other individuals. However, if information that relates to other individuals is retained in a consumer’s files, that must be disclosed given the requirement that a “CRA must disclose all items in the consumer’s file.”524
With a limited number of exceptions, the FCRA requires that all information in the consumer’s file at the time of the consumer’s request must be provided to the consumer.466 The Act explicitly requires CRAs, upon request of the consumer, to “clearly and accurately disclose . . .
Given that the FCRA requires disclosure of everything in the consumer’s “file” (with limited exceptions)486 and the broad scope of that term, a CRA should be required to disclose all information it possesses regarding consumers, even if it is not currently disclosed to users.
In some cases, the consumer’s form of the request or the recipient of the request may result in not all “file” information being disclosed. Courts have differed as to whether such failures to disclose all information is a violation of the FCRA.
The FCRA mandates specific procedures when a CRA furnishes “items of information on consumers which are matters of public record and are likely to have an adverse effect upon a consumer’s ability to obtain employment.”1065 This requirement applies only when the consumer report is furnished for employment purposes1066 and the public record information is adverse.
The first option that a CRA can choose is to notify the consumer, at the time that public record information is released, that the CRA is furnishing public record information to a user, together with the name and address of the person to whom such information is being released.1081 This option is necessary for CRAs that generate their employment reports from a preexisting database rather than collect the data from court records on an as-needed basis.
The second option a CRA can elect is to maintain strict procedures to ensure that the public record information is both complete and up to date.1089 While section 1681k does not specifically use the term “accuracy,” some, but not all, courts have held that inaccurate information violates this section.1090 Compliance with this section is in addition to compliance with section 1681e(b).1091 Whether a defendant followed strict procedures is gene
The procedures required for the reporting of adverse public record information for employment purposes does not apply in the case where a United States agency or department seeks the report, if the head of that agency or department makes a written finding.1116 The finding must state that the report is relevant to a national security investigation, the investigation is within the jurisdiction of the agency or department, and there is reason to believe that one of six conditions will occur, if the exemption does not apply.
There are several ways that public record information in a consumer’s file can end up with errors. Just like information from furnishers, the source public record could itself contain an error.466 Consumer reporting agencies are not likely to discover and correct such errors on their own. In addition, errors are sometimes made by CRAs (or the companies they hire) in copying information from public records.
Once a CRA undertakes to report public information, it is unreasonable to fail to update it.848 This would reduce the number of errors that occur when the CRAs rely upon stale public information.
Duplicate accounts can occur when debts are sold or transferred from one furnisher to another, either for collection or as part of sale of a portfolio of loans. This problem especially affects student loans532 and debt collection accounts.533 One older study revealed that twenty-nine percent of tradelines, fifteen percent of inquiries, and twenty-six percent of public record entries were duplicates.534
The CRA must disclose to the consumer not only all information in the consumer’s file at the time of the request, but also must clearly and accurately disclose the sources of that information.560 Thus, CRAs must disclose the identity of all furnishers of information,561 with the exception of medical furnishers.562 The consumer should not need to specifically request that the CRA identify the sources, although there is conflicting caselaw.