FHA Informed Consumer Choice Disclosure

This feature was added in Encompass 18.2.

Originators of FHA loans can use the FHA Informed Consumer Choice Disclosure setting to populate default data to the loan comparison table on the Informed Consumer Choice Disclosure tab on the FHA Management form as needed to comply with regulatory requirements. The data is then populated to the FHA Informed Consumer Choice Disclosure Notice output form. The FHA Informed Consumer Choice Disclosure Notice provides a one-page generic analysis comparing the mortgage costs of an FHA-insured mortgage with the mortgage costs of similar conventional mortgage products offered by the lender for which the borrower may qualify. The setting includes two columns that are populated with default data: one for FHA Financing 203(b) Fixed Rate and one for Conventional Financing 95% with Mortgage Insurance. The data can be updated as needed. The recommended best practice is to revise the entries at least once a year to reflect prevailing market conditions.

Beginning with the Encompass 18.3 release, the seed data for the conventional financing interest rate is set at 5% by default to match the calculations provided in the FHA 203(b) portion of the setting. Prior to the Encompass 18.3 release, the default value was set at 100%. If you clear all the options in the setting, Encompass generates a default disclosure form with a 7% scenario.

To Access the FHA Informed Consumer Chose Disclosure Setting:

  1. On the menu bar, click Encompass, and then click Settings.
  2. On the left panel, click Loan Setup, and then click FHA Informed Consumer Choice Disclosure.
  3. Using the fields provided, enter or modify the default data to populate to the loan comparison table located on the Informed Consumer Choice Disclosure tab of the FHA Management form. The data is then populated to the FHA Informed Consumer Choice Disclosure Notice output form when it is generated or printed.

It is recommended that you revisit this setting at least once a year to ensure this data reflects prevailing market conditions and is compliant with regulatory requirements.