Rules in October 2024 Release

With the release of 24.2, fees entered for HUD ID 803 are properly mapped to Section B. Services You Cannot Shop For when the applicable fee criteria are met. Previously, these fees were incorrectly mapped to Section A. Origination Charges on both the Loan Estimate (LE) and Closing Disclosure (CD).

This release removes the need for Encompass-specific rules that were enforced under Rule Header 1001432 Federal - Integrated Disclosure Section A Origination Charges, reverting this rule to the standard fee treatment.

With this update, users who have opted into this functionality will now receive the standard WARNING or FAIL status messages when submitting loans with fees mapped as Section A on the LE and CD, aligning the behavior with the expected fee treatment.

Effective January 1, 2025, the Indiana Uniform Consumer Credit Code (UCCC) and Indiana Home Loan Practices Act will implement adjusted dollar amounts for various thresholds. This change reflects the Department of Financial Institutions' (DFI) announcement regarding the new limits, which will now take effect in January rather than July.

For loans closed on or after January 1, 2025, the system will apply

• the Loan Amount Limitation under the Indiana UCCC to subordinate lien loans with an APR exceeding 21%, secured by real property in Indiana. The system will fail such a loan if the principal amount is less than or equal to $5,200. Ind. Code §§ 24-4.5-1-106; 24-4.5-3-510; 750 IAC 1-1-1.

• the Property Insurance Restriction under the Indiana UCCC to subordinate lien loans secured by real property in Indiana when property insurance is included in the loan. The system will fail such a loan if the amount financed or principal, exclusive of the charge for insurance, is equal to or greater than $1,290, and the property value is equal to or greater than $1,290. Ind. Code §§ 24-4.5-1-106; 24-4.5-4-301; 750 IAC 1-1-1.

• the Loan Principal Amount Limitation of $60,000, in line with Indiana High Cost Home Loan Limitations: (a) "High cost home loan" means a home loan with . . . (2) total points and fees that exceed: (A) five percent (5%) of the loan principal for a home loan having a loan principal of at least sixty thousand dollars ($60,000); or (B) six percent (6%) of the loan principal for a home loan having a loan principal of less than sixty thousand dollars ($60,000).Ind. Code § 24-9-2-8; 750 IAC 1-1-1.

The following updated limits will apply to all Indiana loans submitted with a closing date on or after January 1, 2025:

• Loan Amount: $5,200
• Insurance Fee: $1,290
• Loan Principal: $60,000

ECS previously used the APR for rate threshold testing of fixed-rate loans under the New Mexico Home Loan Protection Act. This was due to the undefined nature of "contract rate" as described in Subsection 58-21A-3(I). The APR is commonly utilized in various high-cost acts for threshold testing, and ECS adopted a conservative approach given the lack of clarity.

In this release, the rules pertaining to the New Mexico Home Loan Protection Act have been updated to replace the APR with Note Rate for the following rule headers.

Affected Rule Headers

• New Mexico - High Cost (First Liens)(07/09)(60660)
• New Mexico - High Cost (Junior Liens)(07/09)(60670)
• New Mexico - High Cost (FHA/VA First Liens)(07/09)(60700)
• New Mexico - High Cost (FHA/VA Junior Liens)(07/09)(60710)

This change affects fixed-rate loans equal to or greater than $20,000.

ECS has been updated to include additional detailed messaging in existing FAIL status messages with dynamic messaging and new PASS status messages for users who submit a loan in the state of North Carolina, where applicable and available.

ECS has been updated to modify the Ohio Interest Provisions Maximum Rate test, utilizing the consummation date instead of the loan disbursement date for determining the look up date for the index value. Ohio Revised Code 1343.01(4).