Updates and Enhancements in Version 22.3.0.5 (Banker Edition)
This section discusses the updates to features being introduced in this Encompass release.
Update to the Encompass Client Machines
The Encompass 22.3 December Service Pack Critical Patch 1 release includes the following update, which will be applied to users' Encompass client machines (22.3.0.5). This client update can be controlled manually via the Encompass Version Manager tool. If the tool has been configured to always apply new releases to users’ computers automatically, users will receive this update upon their initial log in of Encompass following the release.
On December 21, 2022, the Consumer Financial Protection Bureau (CFPB) published the following updates to the Points and Fees verbiage and the ATR/QM test calculation to reflect the 2023 TILA (Regulation Z) Annual Threshold Adjustments for HOEPA and ATR/QM.
Updated QM Threshold on ATR/QM Qualification Tab
For non-VA IRRRL loans that have a Document Signing Date (field ID 1887), Closing Date (field ID 748), or Estimated Closing Date (field ID 763) of 1/1/2023 or later, the calculations shown in the table below are used to populate the Current Qualified Mortgage Fee Threshold amount (field ID QM.X121). The threshold amount is then used to calculate the Current Qualified Mortgage Fee Threshold percentage (field ID QM.X122).
Loan Amount | QM Fee Threshold |
---|---|
$124,331 or greater | 3% of the RegZ Total Loan Amount (field ID QM.X120) |
$74,599–$124,330.99 |
$3,730.00 |
$24,866–$74,598.99 |
5% of the RegZ Total Loan Amount |
$15,541–$24,865.99 |
$1,243.00 |
less than $15,541 | 8% of the RegZ Total Loan Amount |
For VA IRRRL loans, regardless of the loan dates or loan amount:
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The Current Qualified Mortgage Fee Threshold percentage (field ID QM.X122) is 3% of the RegZ Total Loan Amount (field ID QM.X120).
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The Current Qualified Mortgage Fee Threshold amount (field ID QM.X121) is 3% of the RegZ Total Loan Amount (field ID QM.X120).
For VA loans not originated as IRRRL, the points and fees test will be run, but it will be ignored for purposes of Safe Harbor.
Updated Verbiage on Section 32 HOEPA
For loans with a Document Signing Date (field ID 1887), Closing Date (field ID 748), or Estimated Closing Date (field ID 763) of 1/1/2023 or later, the following verbiage displays in the Points and Fees Test section on the Section 32 HOEPA Input Form:
For a loan amount of $24,866 or more total points and fees cannot exceed 5% of the total loan amount; For Loan amounts less than $24,866 the total points and fees cannot exceed the lesser of 8% of the total loan amount or $1,243; The dollar amounts used in this test may be adjusted each year, effective January 1.
Updated Section 32 Points and Fees Test
For loans with a Document Signing Date (field ID 1887), Closing Date (field ID 748), or Estimated Closing Date (field ID 763) of 1/1/2023 or later, the percentages shown in the second column below are now populated for the Maximum points and fees allowed percentage (field ID S32DISC.X100) and the calculations shown in the third column are now used to populate the Maximum points and fees allowed amount (field ID S32DISC.X101).
Loan Amount | Maximum Points and Fees Allowed Percentage | Maximum Points and Fees Allowed Amount |
---|---|---|
$24,866.00 or greater | 5% | 5% of the Reg Z Total Loan Amount (field ID QM.X120) |
Less than $24,866.00 | 8% | Lesser of $1,243.00 or (8% of the Reg Z Total Loan Amount) |
CBIZ-45960
Encompass uses the calculations described in the tables below to determine the cost-based comparison of the QM APR to the APOR and to populate the General Qualified Mortgage Price Limit (field ID QM.X384) on the ATR/QM Eligibility tab on the ATR/QM Management input form with a green check mark icon to indicate that the loan meets ATR/QM standards or a red flag icon to indicate that the loan does not meet ATR/QM standards.
These calculations apply to loans that meet the following three criteria:
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The Use Price-Based General QM check box (field ID QM.X383) is selected on the Qualification tab on the ATR/QM Management input form.
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The Loan Application Date (field ID 745) is on or after the Encompass Admin Policy Setting for Use Price Based General QM Definition Date.
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The Loan Rate (field ID 3) is greater than 0.
For loans that do not meet these criteria, Encompass leaves the General Qualified Mortgage Price Limit (field ID QM.X384) blank.
Calculations for first lien properties that are not manufactured housing.
Loan Amount (field ID 1109) | Calculation | Icon |
---|---|---|
$124,331 or greater | QM APR (field QM.X381) is less than (2.25 + APOR (field ID 3134)) | |
$74,599–124,330.99 | QM APR is less than (3.5 + APOR) | |
Less than $74,599 | QM APR is less than (6.5 + APOR) | |
$124,331 or greater | QM APR is greater than or equal to (2.25 + APOR) | |
$74,599–124,330.99 | QM APR is greater than or equal to (3.5 + APOR) | |
Less than $74,599 | QM APR is greater than or equal to (6.5 + APOR) |
Calculations for subordinate lien properties that are not manufactured housing.
$74,599 or greater | QM APR is less than (3.5 + APOR (field ID 3134)) | |
Less than $74,599 | QM APR is less than (6.5 + APOR) | |
$74,599 or greater | QM APR is greater than or equal to (3.5 + APOR) | |
Less than $74,599 | QM APR is greater than or equal to (6.5 + APOR) |
Calculations for manufactured housing.
Loan Amount (field ID 1109) | Mortgage Lien Type (field ID 420) | Calculation | Icon |
---|---|---|---|
$124,331 or greater | First |
QM APR (field QM.X381) is less than (2.25 + APOR (field ID 3134)) |
|
Less than $124,331 | First | QM APR is less than (6.5 + APOR) | |
$124,331 or greater | First | QM APR is greater than or equal to (2.25 + APOR) | |
Less than $124,331 | First | QM APR is greater than or equal to (6.5 + APOR) |
Manufactured housing includes loans with any of the following options selected for Property Type (field ID 1041):
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Manufactured Housing
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Mfd Home/Condo/PUD/Co-Op
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MH Select
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MH Advantage
Additionally, the General Qualified Mortgage header (field ID QM.X40) now displays the Green Check Mark, Blue Flag, or Red Flag icon based on the following:
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If the prerequisite is met for QM, the header now ignores the Debt to Income Ratio Test (field ID QM.X47) when determining eligibility.
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If prerequisite is not met for QM, the header now ignores the Price Limit Test (field ID QM.X384) and uses the Debt to Income Ratio Test (field ID QM.X47) when determining eligibility.
CBIZ-50636
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