Written By: Brent Green, Staff Writer, MortgageCurrentcy.com.
How does that go? “The road to ______ is paved with good intentions!.”
The new RESPA rules started to go into effect over the past year and are scheduled to finalize implementation on January 1, 2010. “Changed Circumstances” is part of the implementation of the new Good Faith Estimate disclosure rules and tolerances.
“Changed Circumstances” is the standard by which you determine whether you may (not should) issue a revised GFE. HUDs 7 (and counting) updated FAQ’s made a number of changes to the proposed rule and has clarified the different types of circumstances that can be a basis for providing a revised or new GFE.
Brass Tax – HUD wants you to be clear about costs and does not want you changing costs without documented reasons that HUD considers allowable. But, just ask any head of operations – they have been sitting in webinars with attorneys to learn about the implementation of all the changes coming in January, and are coming out the other side thoroughly confused with no real consensus being reached.
I will reserve judgment until I get to use all of this in practice, but I have got to tell you…so much for simplifying the rules. They are getting more complex and it is getting more and more difficult to achieve compliance.
The 2008 RESPA proposed rule referred to “unforeseeable circumstances” and since these unforeseen circumstances happened enough to be “reasonably foreseen”, the final rule replaced the definition of “unforeseeable circumstances” with a new definition for “Changed Circumstances”. Now, what do the linguistic changes mean?
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