Nomura Asset Depositor Company, LLC ABS-15G
Exhibit
99.15
PRET
2026-RPL1
Opus
Capital Markets Consultants, LLC
Executive
Narrative |
Opus
Capital Markets Consultants, LLC
300
Tri-State International | Suite 320
Lincolnshire, IL 60069
224.632.1300 | www.opuscmc.com
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Executive
Narrative
February
5, 2026
Performed
by
Opus
Capital Markets Consultants, LLC
For
Pretium
Partners, LLC
The
report summarizes the results of a due diligence review performed on a pool of 243 loans, of which were purchased by Pretium Partners,
LLC (“Customer”) from originators (the “Originator”) who were previous clients of Opus Capital Markets
Consultants, LLC (“Consultant”) under a reliance letter, and for which the Originators provided Consultant with a
data tape, from which, in each case, 100% of the loan population was chosen and loaded into the Paragon, OpusFirst and LauraMac
underwriting software. Consultant performed a detailed compliance and credit review on two hundred thirty-one (231) loans and
a compliance only review on twelve (12) loans.
The
credit and compliance loans were underwritten in accordance with the lender guidelines in terms of Exhibit A and is identified
as two (2) QM/Non-HMPL loans and two hundred twenty-nine (229) QM: Safe Harbor GSE Temporary loans. The twelve (12) compliance
only loans were underwritten in accordance with the lender guidelines in terms of Exhibit B.
EXHIBIT
A
Credit
Review
Credit
Qualification
A
re-underwriting review will be conducted in order to verify that the requisite underwriting guidelines as specified by Client
are met. Confirmation of the loan terms will be performed through recalculation and review of documentation contained in the loan
file provided to the Consultant. The Credit Qualification review will consist of the following:
| a) | Guidelines:
Determine whether each mortgage loan meets the requisite guideline requirements as
specified by the Client. In lieu of specific requirements, Consultant should consider
Regulation Z including Appendix Q if applicable. If the loan pre-dates the requirements
of Regulation Z and Appendix Q, Consultant will consider Fannie Mae’s Single-Family
guidelines. |
| b) | Employment:
Review the file documentation for minimum required level of employment, income and
asset verifications pursuant to Client provided underwriting guidelines. |
| c) | Income:
Recalculate borrower(s) monthly gross income and verify calculations of income as
used by the original loan underwriter at origination to determine compliance with the
Client provided underwriting guidelines. |
| d) | Assets:
Confirm the presence of adequate asset documentation to comply with the Client provided
underwriting guideline requirements for closing funds, reserves and borrower liquidity. |
| e) | Debt
Ratio: Recalculate the debt to income ratio and verify the ratio accuracy used by
the loan underwriter at origination to determine compliance with Client provided underwriting
guidelines and regulatory requirements. |
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| f) | Property
Valuation: Analyze all appraisals and alternative value tools used to qualify the
loan for integrity of comparable sales, completeness of data, eligibility of the appraiser
and reasonableness of estimated value. Review the appraisal to determine the appraisal(s)
meet the requirements of Client provided underwriting guidelines. |
| g) | Loan-to-Value
Ratio: Recalculate and verify the loan-to-value ratio and combined loan-to-value
ratio were accurate at origination and meet Client provided underwriting guideline and
regulatory requirements. |
| h) | Credit
History: Review the credit report to verify that the borrower(s) demonstrate adequate
credit depth to comply with the Client provided underwriting guideline requirements. |
| i) | Credit
Scores: Verify that borrower(s) meet minimum credit score requirements of the Client
provided underwriting guidelines. |
| j) | Compensating
Factors: Verify exceptions to the Client provided underwriting guidelines are documented
and reasonable. |
Document
Review
Document
Review
A
review of each loan file will be performed to confirm the presence of material documentation as applicable to the specifics of
the loan transaction. The Document Review will consist of the following:
a)
Collateral Docs
| ● | Title
Commitment / Policy: Verify the presence of the title commitment or final title policy.
Confirm vested parties and the description of the property, liens and tax assessments. |
| ● | Mortgage
Note / Security Instrument: Verify the presence of the mortgage note or security instrument.
Confirm that the document has been executed by all borrowers and that all riders, addendums
and endorsement are present and duly executed. |
| ● | Mortgage
/ Deed of Trust: Verify the presence of a copy Mortgage or Deed of Trust. Confirm that
the documents have been executed by all required parties and that all riders, addendums
and exhibits are present and duly executed. If the loan closed within 12 months of the
review, Consultant will confirm the presence of a letter from the title company specifying
the date the Mortgage / Deed Trust was sent for recording. If the closing did not occur
within 12 months of the review and a copy of the recorded Mortgage /Deed of Trust is
not contained in the loan file, the Client will submit a report from an independent document
custodian verifying the presence of a recoded mortgage or a stamped / signed copy of
the document stating the date the document was sent for recording. |
| ● | Conveyance
Deed: Verify as applicable that a proper conveyance deed is present in the loan file. Confirm the proper transfer of ownership
interest of the subject parties is detailed on the deed. |
b)
Closing Docs
| ● | Final
Hud-1 Settlement Statement: If required, verify the presence of a final HUD-1. Verify
the completeness of required data and signatures or certification depending upon state
compliance requirements. |
| ● | Final
Truth-in-Lending Disclosure: If required, verify the presence of a final Truth-in-Lending
Disclosure. Verify the completeness of required data and that all required signatures
are present. |
| ● | Notice
of Right to Cancel: If required based on the specifics of the loan transaction, confirm
the presence and required execution of the Notice of Right to Cancel. |
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| ● | Loan
Estimate: If required verify the presence of the current Loan Estimate (LE) at the time
of origination |
| ● | Closing
Disclosure: If required verify the presence of the current Closing Disclosure (CD) at
the time of origination. |
c)
Credit Docs
| ● | Loan
Application: Verify the presence and completeness of both the initial and final loan
applications. |
| ● | Underwriting
Worksheet: Verify the presence of the relative underwriting worksheet i.e. form 1008,
FHA MCAW and VA’s Loan Analysis. |
| ● | Credit
Report: Verify the presence of a credit report for each borrower. Confirm that the credit
report was pulled within the timing requirements allowable per the Client provided underwriting
guidelines. |
| ● | Housing
Payment History: In the absence of housing payment histories on the borrower(s) credit
report(s), verify that that the file contains a verification of rent or a verification
of mortgage form. |
| ● | Letters
of Explanation: When Letters of Explanation are required by the Client provided underwriting
guidelines, verify the presence of any such letters exist in the loan file. |
| ● | Gift
Letters: When Gift Letters are required by the Client provided underwriting guidelines,
verify the presence of any such letters exist in the loan file. |
| ● | Income
Documentation: Verify the presence of income and employment related documentation required
by the Client provided underwriting guidelines for all borrowing parties contributing
income to the debt ratio calculation. |
| ● | Asset
Documentation: Verify the presence of asset documentation required by the Client provided
underwriting guidelines in the loan file. |
| ● | Property
Valuation Tools: Verify that each loan file contains adequate appraisal and other third
party valuation tools to satisfy the minimum required documentation under the relative
Client provided underwriting guidelines. |
| ● | Proof
of Insurance: Verify the presence of insurance certificates for mortgage, hazard and
flood insurance on an as needed basis depending upon the specifics of the loan. Confirm
that adequate coverage is present to meet the requirements of the Client provided underwriting
guidelines. |
Regulatory
Compliance
Each
mortgage loan file will be subject to a post-closing regulatory compliance review to verify that each mortgage loan closed in
compliance with the applicable federal, state and local anti-predatory lending statutes in effect at the time of origination of
the Mortgage Loan and that the loans meet the applicable disclosure requirements provided under (i) the federal Truth in Lending
Act (“TILA”), as implemented by Regulation Z, 12 C.F.R. Part 1026; (ii) Section 4 of the Real Estate Settlement Procedures
Act (“RESPA”), as implemented by Regulation X, 24 C.F.R. Part 3500; (iii) the National Flood Insurance Act, (iv) the
disclosure requirements and prohibitions of Section 50(a)(6), Article XVI of the Texas Constitution and associated regulations;
and (v) the disclosure requirements and prohibitions of the applicable state, county and municipal laws and ordinances enacted
to combat predatory lending. The review is conducted using both Paragon and Compliance Ease.
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If
applicable, the regulatory compliance review will be conducted in line with the most recently dated Structured Finance Association
(SFA) TRID Compliance Review Scope.
| a) | Federal
Truth in Lending Act/Regulation Z: |
A
review of the material compliance disclosures set forth in Reg Z, as amended, including the Truth in Lending Disclosure and the
Notice of Right-to-Cancel, if applicable; and a review and comparison of the material disclosures with a report outlining any
TILA violations. This includes a re-calculation of disclosed finance charge [§1026.18(d)], proper execution by all required
parties [§1026.17(b)], principal and interest calculations [§1026.18(s)], payment stream(s), recalculation of disclosed
APR [§1026.22], and a review to ensure disclosure differences are within the allowed tolerances [§1026.18(d) and §1026.23(g)].
A review of the Notice of Right to Cancel (§1026.15 / §1026.23): Review includes a verification of the transaction date
and expiration date, ensures proper execution of the Notice of Right to Cancel by all required parties verifies the disbursement
date and determines if a full 3-day rescission period was adequately provided to the borrower(s).
| b) | Federal
Truth in Lending Act/ Regulation Z: |
A
review of the material compliance disclosures set forth in Reg Z, as amended, including the Truth in Lending Disclosure and the
Notice of Right-to-Cancel, if applicable; and a review and comparison of the material disclosures with a report outlining any
TILA violations. This includes a re-calculation of disclosed finance charge [§1026.18(d)], proper execution by all required
parties [§1026.17(b)], principal and interest calculations [§1026.18(s)], payment stream(s), recalculation of disclosed
APR [§1026.22], and a review to ensure disclosure differences are within the allowed tolerances [§1026.18(d) and §1026.23(g)].
A review of the Notice of Right to Cancel (§1026.15 / §1026.23): Review includes a verification of the transaction date
and expiration date, ensures proper execution of the Notice of Right to Cancel by all required parties verifies the disbursement
date and determines if a full 3-day rescission period was adequately provided to the borrower(s). Further, a review of proper
rescission model form usage will be conducted in accordance with Circuit Court ruling methodology related to use of the H8 vs.
H9 forms on same lender rescindable transactions. A condition must be placed if the transaction is a refinance by the original
creditor and the borrower was provided the Form H-8 rescission notice. Opus will note in the condition whether or not there was
a new advance that is subject to rescission per TILA/Regulation Z.
| 1. | Business
Days as Defined by Regulation Z |
General
business day is defined as the days on which a creditor’s offices are open to the public for carrying on substantially all
of its business functions excluding Sundays and holidays specified by §1026.2(a)(6). Specific business day is defined as
all calendar days (Monday through Saturday) excluding Sundays and holidays specified by 5 U.S.C.
6103(a)
| c) | MDIA
(Mortgage Disclosure Information Act) - Applications Dated After 07/30/2009 and Prior
to 10/03/2015):
|
| i) | Initial
Delivery: Creditor must deliver the Initial Disclosures within 3 “general”
business days of application |
| ii) | No
Pre-disclosure Fees: Creditor may not charge fees, other than credit report fee, prior
to borrower receiving the Initial Disclosures |
| iii) | 7
Day Waiting Period: Creditor must deliver the Initial Disclosures more than 7 “specific”
business days prior to closing |
| iv) | 3
Day Waiting Period: Creditor must issue revised disclosures if APR in initial disclosures
becomes inaccurate. Closing may not occur until the 3rd “specific” business
day after the consumer receives the corrected disclosures. |
| v) | APR
on Final TIL: APR on Final TIL must be within tolerance 1/8 or ¼ of percent difference
in APR based on regular or irregular payment stream. |
| d) | Home
Ownership Equity Protection Act (HOEPA) testing, to include:
|
| i) | APR
test [HOEPA (§1026.32(a)(1))] ] |
| ii) | If
missing initial application, missing initial application date or missing rate lock confirmation
results in inability to determine application date or rate set date for purposes of high
cost / higher-priced mortgage loan testing, vendor will test based on: (1) a six-month
window prior to closing date for missing application date; and (2) all dates between
application and closing for missing rate set date. A condition should be set to identify
that the application date or rate lock date is missing and that alternative (look-back)
testing was utilized. Other evidence in the file (e.g. date of initial disclosures, rate
lock expiration on GFE) may be relied upon to estimate application or rate set date but
will be determined by the Client on a case by case basis. |
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| iii) | Points
and Fees test [HOEPA (§1026.32(a)(2))] |
| iv) | Review
of HOEPA disclosure (§1026.32(c)) for accuracy (i.e. payment stream, highest payment
scenario; dates disclosed, dates acknowledged) |
| v) | Review
and confirm documentation type (i.e. full, stated, no ratio) |
| vi) | Review
for evidence of prepayment penalty |
| vii) | Verification
of Debt to Income conformity, when necessary. |
HOEPA
(Section 32) loan coverage has been expanded to include purchase-money mortgages and open-end credit plans (i.e., home equity
lines of credit or HELOCS), as well as the amendment of rate and points and fees threshold testing. Consultant system requirements
have been updated to address the expansion of coverage as well as amendments to threshold testing. In addition, there is a homeownership
counseling requirement to be verified for all covered loans.
| e) | Federal
Higher Priced Mortgage Loan Testing, to include: |
HPML(§1026.35(a)(1))]
- A loan will be considered a Higher Priced Mortgage Loan if the APR exceeds the Average Prime Offer Rate by 1.50% or more percentage
points on Conforming First Liens, 2.50% for Jumbo First Liens and 3.50% or more percentage points on Second Liens.
Escrow
Requirement - Loans that fall under the guidelines of a Higher Priced Mortgage Loan (HPML) will require escrow accounts to be
in place for the first five years of the transaction. A loan will be considered a Higher Priced Mortgage Loan based on the guidelines
shown above (HPML Testing – APR)
HPML
Appraisal Rule - An HPML designation also requires additional appraisal requirements. Requirements include:
| ● | Three-day
disclosure from application of the right to a free copy |
| ● | Written
appraisal from certified or licensed appraiser |
| ● | Delivery
of copies no later than three days prior to consummation |
| ● | If
the property falls under the ‘flipping’ definition, a second appraisal is
required and must document: |
| ● | The
difference in the original sales price and the subsequent sales price |
| ● | Changes
in market conditions |
There
is additional responsibility for providing copies of ALL documentation used in the valuation of the property, not just the final
appraisal, and requirements for full appraisals, versus other forms of valuations. System enhancements have also been made to
require verification of documentation and acknowledgement by the reviewer of evidence supporting the new requirements.
| f) | RESPA/Regulation
X (Loans with an Application Date prior to 10/03/2015): |
Each
mortgage loan will be reviewed to ensure compliance with the January 1, 2010, or most current amendments to Regulation X. The
RESPA/Regulation X review will consist of the following:
| ● | Good
Faith Estimate (GFE): |
| ● | Consultant
will confirm compliance with current RESPA requirements in effect at origination of the
Mortgage Loan including the presence of the current GFE form in effect at the time of
origination. |
| ● | Verify
the GFE was provided to the borrower(s) within three days of “Application”. |
| ● | Application
shall be defined by Regulation X and generally be considered complete when the following
seven conditions are met: |
| 1. | Borrower(s)
First and Last Name |
| 2. | Borrower(s)
Social Security Number (to enable the loan originator to obtain a credit report) |
| 3. | Subject
Property Address (including “To Be Determined”) |
| 4. | Mortgage
Loan Amount Sought |
| 5. | Estimation
of Property Value |
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| 7. | Any
other requirement as defined in the lender’s policies and procedures |
| ● | Consultant
will verify that all Broker fees, including Yield Spread Premium (“YSP”)
were accurately disclosed and reflected in the appropriate locations. |
| ● | Fees
will be reviewed to ensure they are reasonable and customary fees for the lender and
title and escrow companies and that those fees were accurately disclosed on the GFE and
were reflected in the proper location on the document. |
| ● | Analysis
to determine whether a Changed Circumstance form is required to accompany each revised
Good Faith Estimate (GFE) |
| ● | Change
of Circumstance Definition: |
| 1. | Acts
of God, war, disaster or other emergency; |
| 2. | Information
particular to borrower or transaction that was relied on in providing the GFE and that
changes or is found to be inaccurate after GFE has been provided to borrower; |
| 3. | New
information particular to the borrower or transaction that was not relied on in providing
the GFE; or |
| 4. | Other
circumstances that are particular to borrower or transaction, including boundary disputes,
need for flood insurance or environmental problems |
| 5. | In
the event any of the above occurs, the loan originator is required to provide a new revised
GFE to the borrower within 3 business days of receiving information sufficient to establish
“changed circumstances” and document the reason the revised GFE was provided. |
| 6. | Rate
Locks: If the rate has not been locked by the borrower or a locked rate has expired,
the charge or credit for rate chosen, adjusted origination charges, per diem interest
and loan terms related to the rate may change. If borrower later locks the rate, a new
GFE must be provided showing the revised rate-dependent charges and terms. All other
charges and terms must remain the same as on the original GFE, except as otherwise provided
above for “changed circumstances.” |
| ● | Final
HUD-1: Consultant will confirm compliance with current RESPA requirements in effect at
origination of the Mortgage Loan including: |
| ○ | Confirm
the presence of the current applicable Final HUD-1 form |
| ○ | Confirm
the Final HUD-1 accurately lists all broker and YSP fees. |
| ● | Good
Faith Estimate (GFE ) and Final HUD-1 Analysis: Confirm compliance with current RESPA
requirements in effect at origination of the Mortgage Loan including: |
(1)
Analysis of Origination fees disclosed on the Good Faith Estimate (GFE) and those charged to the borrower(s) on the Final HUD-1
(no variance) - No variance for the following charges:
(a)
Origination Charge
(b)
Credit or Charge for Interest Rate Chosen
(c)
Adjusted Origination Charge
(d)
Transfer Taxes
(2)
Analysis of Third-Party fees disclosed on the Good Faith Estimate (GFE) and those charged to the borrower(s) on the Final HUD-1
(10% tolerance) - 10% tolerance between GFE and actual charges at settlement for sum of following services:
(a)
Lender-required settlement services (lender selects third-party provider);
(b)
Lender-required services, title services and required title insurance, and owner’s title insurance, when the borrower uses
a settlement service provider identified by the loan originator; and
(c)
Government recording charges
| ● | Analysis
to confirm all fees are accurately reflected in the correct tolerance category on the
Good Faith Estimate (GFE) and Final HUD-1 |
| ● | Analysis
to confirm lender accurately provided borrower adequate restitution in the event of tolerance
violations and timelines for restitution/document correction were adhered to |
| ● | Analysis
to confirm loan terms are accurately disclosed between the Good Faith Estimate (GFE)
and Final HUD-1 |
| ● | Analysis
to confirm page 3 of the HUD-1 accurately reflects fees disclosed on the Good Faith Estimate
(GFE) and Final HUD-1
|
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| g) | QM
/ ATR (Qualified Mortgage / Ability to Repay) |
QM/
ATR (qualified mortgage / ability to repay) dodd frank review (loans with application date on or after 01/10/2014) covers Legacy
QM Rules (applications on or after 01/10/2014) – elective compliance date of Revised QM Rules (applications on or after
3/1/2021) and mandatory of Revised QM Rules (applications on or after 10/1/2022)
APOR
– APR Test
Consultant
will perform and APOR – APR and initially classify loans as follows:
Safe
Harbor – For a first lien loan, the APR does not exceed the APOR for a comparable transaction by 1.5 percentage points or
more as of the date the interest rate is set.
Safe
Harbor Rebuttable Presumption – For a first lien loan, APR exceeds the APOR for a comparable transaction by 1.5 percentage
points or more but by less than 2.25 percentage points as of the date the interest rate is set.
Non-Qualified
Mortgage – For a first lien loan, the APR exceeds the APOR for a comparable transaction by more than 2.25 percentage points
as of the date the interest rate is set.
After
perform the APOR – APR test, consultant will perform an Ability-to-Repay test based on the 8 verification steps and client
provided underwriting guidies.
Ability-to-Repay
Supplier
shall incorporate checkpoints for the ATR’s eight verification steps for any origination QC work in accordance with 12 CFR
1026.43 (c). Supplier has the option to run ATR checks on any transactions subject to QM that falls outside the ability to meet
QM guidelines, whether due to coverage exceptions or due to failing QM criteria. Thus, any transaction that is being tested for
QM will also have the ability to be screened for ATR if the QM testing fails or the loan is exempt from QM.
As
a part of any ATR check, consultant is required to verify all information within the scope of the eight verification steps before
an ATR loan can pass:
| ● | Current
employment status |
| ● | Monthly
qualifying mortgage payment for the proposed loan |
| ● | Monthly
qualifying mortgage payment for the simultaneous loan |
| ● | Monthly
payment on the same property for payments for taxes, insurance and HOA, etc. |
| ● | Debts,
alimony and child support |
| ● | Qualifying
monthly DTI and residual income |
If
all the verifications are made and each of the eight topic areas is confirmed to agree with the representations made by the lender,
and there are no credit exceptions to the lender’s guidelines, the loan will pass the ATR test. If any of the conditions
fail or the loan lacks the documentation to support the stated values in any of the areas, affected items will not be considered
verified and the loan will be subject to failing the ATR test.
ATR
results will be reported as QM Safe Harbor ATR-Pass, ATR-Fail; QM Rebuttable Presumption ATR-Pass, ATR-Fail; Non-QM ATR-Pass,
ATR-Fail, or ATR-Exempt. This reporting is in addition to the existing credit and compliance related reporting by Supplier.
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| h) | Regulatory
Compliance Disclaimer |
Please
be advised that Consultant will not make a determination as to whether loans complied with federal, state or local laws, constitutional
provisions, regulations or ordinances that are not expressly enumerated herein. There can be no assurance that the review uncovered
all issues relating to the origination of the mortgage loans, their compliance with applicable law and regulation and the original
appraisals relating of the mortgaged properties or uncovered all relevant factors that could affect the future performance of
the mortgage loans. Furthermore, the findings reached by Consultant are dependent upon its receiving complete and accurate data
regarding the mortgage loans from loans originators and other third parties upon which Consultant is relying in reaching such
findings.
Please
be further advised that Consultant does not employ personnel who are licensed to practice law in various jurisdictions, and the
findings set forth in the reports prepared by Consultant do not constitute legal advice or opinions. They are recommendations
or conclusions based on information provided to Consultant. All final decisions as to whether to purchase or enter into a transaction
related to any individual mortgage loan or the mortgage loans in the aggregate, any investment strategy and any legal conclusions,
including potential liability related to the purchase or other transaction involving any such loans, shall be made solely by the
Client, or other agreed upon party, that has engaged Consultant to prepare its reports pursuant to its instructions and guidelines.
Client, or other agreed upon party, acknowledges and agrees that the scoring models applied by Consultant are designed to identify
potential risk and the Client, or other agreed upon party, assumes sole responsibility for determining the suitability of the
information for its particular use.
| i) | Seasoning
And Certain Compliance Exceptions
|
Pursuant
to the applicable NRSRO criteria, Consultant graded certain compliance exceptions as non-material based on seasoning of the mortgage
loan. Certain mortgage loans were seasoned beyond the applicable period under TILA in which affirmative claims could be brought
by a consumer. The time period is not limited for claims, other than recession, which are raised as a defense to foreclosure.
Information contained in any Consultant reports related to the applicable statute of limitations for certain claims may not be
accurate or reflect the most recent controlling case law. Further, a particular court in a particular jurisdiction may extend,
not enforce or otherwise allow claims beyond the statute of limitations identified in the report based on certain factors, including
the facts and circumstances of an individual loan.
TRID
1)
TILA RESPA Integrated Disclosure Statement of Work
Eligibility
The
following criteria are used in determining whether TRID applies:
| ● | The
Application Date is October 3, 2015, or later (the earlier of the date the broker or
lender received the borrower’s application). |
| ● | The
Loan Purpose and Property Type includes a closed-end mortgage secured by real estate: |
| ○ | Refinance
(Cash Out or Rate Term) |
| ○ | Construction
and Construction to Permanent Financing |
| ○ | SFR,
1-4 Unit, PUD, Condo and Coops (Coop may be excluded based on Client instructions) |
| ● | The
Loan Purpose and Property Type does not include: |
| ○ | Dwellings
that are not attached to real property |
| ○ | Mobile
homes, where the consumer does not own the land, |
| ● | For
purposes of determination of Occupancy, TRID applies to loans for owner occupied, second
home and vacant land. |
| ● | Opus
will apply the standard exemptions from TILA, i.e., business purposes loans, loans for
agricultural purposes and loans secured by five (5) or more units. |
(a)
Please be aware that TILA contains a TRID-specific exemption for certain subordinate lien loans for the purposes of various types
of assistance programs such as down payment or closing cost, property rehabilitation, energy efficiency or foreclosure avoidance
or prevention. Opus will not test such loans for TRID compliance.
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Loan
Estimate (″LE″)
| ● | Verification
of compliance with timing requirements as to whether the Initial LE was delivered within
three (3) business days from the Application Date. The Initial LE shall use the delivery
date to calculate the earliest closing Consummation Date (no less than seven (7) business
days from the delivery of the Initial LE). The delivery date is the date the creditor
hand delivers the disclosures or places the disclosures in the mail, 1026.19(e)(1)(b)
If the LE does not contain a signature line for the consumer’s confirmation of
receipt, then Opus will look for the “Loan Acceptance” statement under “Other
Considerations” or other client-documented acknowledgement and borrower intent
to proceed. |
| ● | Verification
that the correct form is used and all sections of the Initial LE are completed (no blanks,
“NA’s” or incomplete sections) and the Initial LE is accurate as follows: |
| ● | Verification
of the technical formatting of the LE is NOT included in the standard review. The formatting
of the document is the responsibility of the document preparation source. |
| ● | General
loan information and loan terms sections completed and formatting is accurate. |
| i. | Verify
loan term, purpose, and product descriptions follow the prescribed format. |
| ii. | Verify
all applicants applying for credit, as disclosed on the application, are listed on the
LE |
| ● | “Can
this amount increase after closing?” and “Does the loan have these features”
sections are completed and are accurate based on the terms disclosed on the LE. |
| ● | If
rate is locked, were lock expiration date, time and time zone disclosed. |
| ● | Settlement
charges good through date, time and time zone disclosed with minimum of 10 days during
which borrower is permitted to shop knowing fees are locked during that timeframe. |
| ● | Projected
Payments and Estimated Taxes, Insurance & Assessments sections are complete and accurate
based on the loan terms and information known at the time of disclosure. |
| ● | The
Closing Costs and Cash-to-Close sections are complete and accurate based on the information
provided on page 2 of the LE. |
| ● | Fees
disclosed properly (alphabetical order within Section with certain exceptions, and all
title fees start with ″Title – ″) in Closing Cost Details section. |
| ● | It
is recommended that an Itemization of Fees is provided for any fees disclosed as “Aggregate”.
It is quite difficult to determine if the fees are disclosed properly without this information. |
| ● | Any
addenda found in file listing ADDITIONAL fees for sections other than Section C |
| ● | If
Interest Only Payments, Optional Payments, Step Payments, or Seasonal Payments, is Adjustable
Payment (″AP″) Table disclosed and accurate based on early disclosures in
the file. |
| ● | If
ARM or Step Rate, is Adjustable Interest Rate (″AIR″) Table disclosed and
accurate based on the early disclosures in the file. |
| ● | The
Comparison section is complete and accurate as follows: |
| ● | In
5 Years calculations for Total of Payments (TOP) and Total Principal Paid are accurate
based on the terms and fees disclosed on page 1 and 2 of the LE. |
| ● | APR
is accurate within tolerance based on the terms disclosed on the LE |
| ● | Total
interest Percentage (TIP) is accurate based on the loan terms disclosed on the LE. |
| ● | Rounding
rules verified as per 1026.37(o)(4). |
| ● | Other
Considerations Section is complete |
If
there has been a revision to the LE, validate that the Revised LE is provided within three (3) days of COC, BRC or interest rate
lock. Review as necessary for sufficient information to establish one of the six (6) valid reasons to reset tolerance fees set
forth in TRID:
| ○ | Changed
Circumstance affecting settlement charges |
| ○ | Change
Circumstance affecting eligibility |
| ○ | Revisions
requested by the consumer |
| ○ | Interest
rate dependent charges |
| ○ | Expiration
of the LE and |
| ○ | Delayed
settlement date on a construction loan |
| ○ | Timing
Requirement for LE 7 days prior to consummation
|
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| 3. | Determination
of Final Binding LE |
| ● | Review
and analyze each LE in file to determine final Binding LE. If there is a change in loan
terms, change in interest rate or increase in charges subject to variances without valid
reason for a Revised LE as set forth above, findings will be cited. If a Revised LE was
issued without a valid reason, the previous valid LE would be considered the Binding
LE for the purposes of comparison with the Closing Disclosure. [Also see Variance Tests
and Closing Disclosure for COC/BRC events disclosed after issuance of Initial CD] |
| ● | Verification
of compliance with timing requirements that there have been no loan estimates provided
to the borrower after a Closing Disclosure has been delivered, and whether the Final
LE was provided at least four (4) business days prior to the closing Consummation Date. |
If
the LE does not contain a signature line for the consumer’s confirmation of receipt, then Opus will look for the “Loan
Acceptance” statement under “Other Considerations” or other client-documented acknowledgement and borrower intent
to proceed.
| ● | Verification
that the correct form is used and all sections of the Initial LE are completed (no blanks,
“NA’s” or incomplete sections) and the Initial LE is accurate as follows: |
| ● | Verification
of the technical formatting of the LE is NOT included in the standard review. The formatting
of the document is the responsibility of the document preparation source. |
| ● | General
loan information and loan terms sections completed and formatting is accurate. |
| ● | Verify
loan term, purpose, and product descriptions follow the prescribed format. |
| ● | Verify
all applicants applying for credit, as disclosed on the application, are listed on the
LE |
“Can
this amount increase after closing?” and “Does the loan have these features” sections are completed and are
accurate based on the terms disclosed on the LE.
| ● | If
rate is locked, were lock expiration date, time and time zone disclosed. |
| ● | Settlement
charges good through date, time and time zone disclosed with minimum of 10 days during
which borrower is permitted to shop knowing fees are locked during that timeframe. |
| ● | Projected
Payments and Estimated Taxes, Insurance & Assessments sections are complete and accurate
based on the loan terms and information known at the time of disclosure. |
| ● | The
Closing Costs and Cash-to-Close sections are complete and accurate based on the information
provided on page 2 of the LE. |
| ● | Fees
disclosed properly (alphabetical order within Section with certain exceptions, and all
title fees start with ″Title – ″) in Closing Cost Details section. |
| ● | It
is recommended that an Itemization of Fees is provided for any fees disclosed as “Aggregate”.
It is quite difficult to determine if the fees are disclosed properly without this information |
Any
addenda found in file listing ADDITIONAL fees for sections other than Section C
| ● | If
Interest Only Payments, Optional Payments, Step Payments, or Seasonal Payments, is Adjustable
Payment (″AP″) Table disclosed and accurate based on early disclosures in
the file. |
| ● | If
ARM or Step Rate, is Adjustable Interest Rate (″AIR″) Table disclosed and
accurate based on the early disclosures in the file. |
| ● | The
Comparison section is complete. |
| ● | Rounding
rules verified as per 1026.37(o)(4). |
| ● | Other
Considerations Section is complete |
| 4. | Written
List of Providers (“WLSP”) |
If
the lender places fees in the Services You Can Shop For category, verify that the file contains a Written List of Providers provided
to the borrower within three (3) business days of application. The WLSP must include at least one available provider for each
service and state the consumer may choose a different provider for that service. If a written list of service providers is not
provided, the fees will be treated as a 10% Tolerance fee but a finding for missing service provider list will be noted. If a
written list of service providers is provided outside of three (3) days of the application date, the fees will be treated as a
10% Tolerance fee but a finding for a service provider list being provided outside of three (3) days from application will be
noted.
Utilize
one (1) of the following Variance Categories in performing variance tests:
Zero
Tolerance/Variance* - A finding will be cited if any charges increase from the Binding LE to the Final CD without COC or BRC.
Such increases include:
| ● | Fees
paid to the lender, broker or an affiliate of either lender or broker [fees paid to an
affiliate of the lender for services NOT required by the creditor are not subject to
tolerance/variance per CFR 1026.19(e)(3)(iii)(E)]; |
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| ● | Fees
paid to an unaffiliated third party if the lender did not permit the borrower to shop
for servicer; and |
Any
fees that increase on the CD and are paid at closing by someone other than the borrower (e.g. seller or other third party) should
be treated as borrower-paid for purposes of the tolerance calculations in 12 CFR § 1026.19(e)(3)(i) – (iii). For example,
if a $500 appraisal fee (for which the borrower could not shop) was disclosed on the LE as paid by the borrower or in part by
the seller, and the fee subsequently increases to $750 on the CD, the $250 increase must be considered, and a tolerance refund
of $250 will be due to the borrower unless the increase had been re-disclosed subject to a valid changed circumstance. However,
if a fee is not disclosed on the LE, or only the portion that is borrower-paid is disclosed on the LE, there is no tolerance violation
(a) if there is evidence in the file to show that the fee was intended to be paid by the seller in full or in part (e.g. fee is
addressed in the purchase contract and the amount to be paid by the seller on the CD corresponds with the contract) or (b) if
the fee is known to be a fee that is the responsibility of the seller (i.e. a transfer tax in which local law/regulation provides
that the seller is responsible for the fee). Fees paid by the lender should be reviewed for compliance with 12 CFR § 1026.19(e)(3)(i)
(i.e. fees that increase and are subject to an increased lender credit do not constitute a violation, but a decreased lender credit
that was not re-disclosed subject to a valid changed circumstance is a violation and will require a refund).
10%
Tolerance/Variance* – A finding will be cited if the aggregate of the charges increase by more than 10% from the Binding
LE to the Final CD without COC or BRC. If a fee/service is listed on the LE but not charged/reflected on the Final CD, the fee
will be removed and not considered in calculating the 10% variance threshold pursuant to Comment 19(e)(3)(ii)-5. Such increases
include:
| ● | Charges
for third party services not paid to creditor or affiliate AND borrower permitted to
shop for service but selects a provider on the creditor’s Written List of Service
Providers. |
| ● | Prepaid
mortgage insurance will be treated as a 10% tolerance fee if it can be shopped for (and
not identified as an affiliate), otherwise it will be treated as a zero tolerance fee. |
| ● | Client
considers seller-paid fees or fees paid by third-parties as borrower-paid for the purposes
of tolerance calculations in 12 CFR §1026.19(e)(3)(i) – (iii) as detailed
in section (5) Variance tests (v) |
No
Tolerance/Unlimited – No finding will be cited if any of the charges change from the Binding LE to the Final CD, provided
that the disclosed amount on the LE is based on information reasonably known to the creditor at the time of disclosure (disclosed
in good faith), such as:
| ● | Property
insurance premiums; |
| ● | Charges
for services required by the creditor but the borrower is permitted to shop for and borrower
selects a third party provider not on the lender’s Written Service Provider List;
and |
| ● | Charges
for third party services NOT required by the creditor (even if paid to an affiliate of
the creditor). |
Notes
of interest for “No Tolerance/Unlimited”: No finding will be cited if any of the charges change from the Binding
LE to the Final CD, provided that the disclosed amount on the LE is based on information reasonably known to the creditor at the
time of the disclosure (disclosed in good faith),
| ● | Prepaid
property taxes charged by local and state governments periodically will have no tolerance
under the general ‘best information reasonably available’ standard unless
otherwise instructed by the Client. |
| ● | As
noted above, Opus will review the loan file for evidence the disclosure was not made
in “Good Faith”. “Good faith” means the creditor made the estimate
based on the information reasonably available to them at the time the LE was provided.
Absent such evidence, Opus will consider the disclosures made in “good faith”.
Two examples where a disclosure would be considered not made in “good faith”
and a finding cited are: |
| 1. | The
creditor requires homeowner’s insurance but fails to include a homeowner’s
insurance premium; a finding will be added that the LE was not issued in good faith. |
| 2. | The
creditor knows the loan must close on the 15th of the month but estimates prepaid interest
to be paid from the 30th of that month, a finding will be added that the LE was not issued
in good faith. |
| ● | Review
for documentation itemizing fees from the Binding LE to determine unrounded amounts of
fees to use for performing tolerance testing only if a tolerance violation occurs. If
no fee itemization is found, tolerance testing will be performed based on the information
in the disclosures and a tolerance violation will be noted if applicable. Utilize fee
information from closing instructions or a vendor compliance report, if the file contains
the referenced support documentation. |
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Additionally,
if a documented valid COC or BRC occurs resulting in a change to loan terms, settlement charges or interest rate within four (4)
business days of consummation, the variance test will be performed based on the revised amounts disclosed on the initial CD (or
subsequent CD if change occurs after initial CD has been provided) provided that the change is related to the COC or BRC.
| ● | For
loans with no Interim LE and no COC or BRC occurring four (4) days prior to consummation,
fees and charges on the CD are tested for compliance with permitted variances against
fees disclosed on Initial LE. |
| ● | For
loans with an Interim LE, the following procedures will be applied: |
| ○ | Review
of each Interim LE and fees and charges on the CD are tested for compliance with variance
thresholds against fees supported by a valid COC or BRC related to the charge that increases |
| ● | In
cases where an Interim LE is issued with several fee increases, but only some are supported by or related to a valid COC or BRC,
those fees which are not supported by or related to a valid COC, BRC or disclosed on an LE that was not provided timely (within
three (3) business days of changed circumstance) will be tested for variance using the amounts disclosed in the Initial LE previously
valid LE. |
Closing
disclosure (″CD″)
| ● | Opus
will conduct a general CD review and verify the following: |
| ● | Recommendation:
Closing Disclosure provided at closing be marked “Final.” Although this is
not a requirement, marking the Closing Disclosure as Final will ensure a timely review. |
| ● | That
the correct form is used and all sections of the CD are completed (no blanks or incomplete
sections). |
| ● | Acknowledgement
of receipt by all borrowers with a right to rescind under 1026.23 by verifying that each
borrower with a right to rescind was provided with a copy of the CD. This could include
the non-borrowing spouse. Acknowledgement is based on lender guidelines |
| ● | If
the CD does not contain a signature line for the consumer’s signature, Opus will
look for the required alternative statement in “Other Disclosures” with the
heading of “Loan Acceptance”. While not required, Opus highly recommends
that the client require the CD to be signed and dated by the consumer as it will ensure
a timely review. |
| ● | If
a subsequent CD is issued having changes to (a) the loan product which affects disclosed
terms and loan information; (b) the addition of a prepayment penalty; or (c) an APR which
exceeds the previously disclosed APR by more than 1/8 or ¼ of one percent on regular
or irregular transactions, as the case may be for accuracy. Consultant will test that
the borrower was given an additional three (3)-business day waiting period from the date
of final pre-close CD with (a) the final loan product; (b) the prepayment penalty addition;
or (c) the APR, and that the final pre-close CD has been received by borrower by consummation.
APR reductions beyond these tolerances require the additional 3 day waiting period unless
the overstated APR was based on an overestimated finance charge. |
| ● | On
the interim and final pre-close CDs the following checks and limitations apply: |
| ● | Verification
of the technical formatting of the CD is out of scope in the standard review. The formatting
of the document is the responsibility of the document preparation source. |
| ● | Closing,
Transaction and Loan Information sections have been completed with accurate information. |
| ● | Loan
terms sections are completed. |
| ○ | Opus
will verify loan term, purpose, and product descriptions follow the prescribed format. |
| ○ | Opus
will verify all applicants applying for credit, as disclosed on the application, are
listed on the LE |
“Can
this amount increase after closing?” and “Does the loan have these features” sections are completed accurately.
| ● | Projected
Payments and Estimated Taxes, Insurance & Assessments sections are completed accurately. |
| ● | Fees
have been disclosed properly (alphabetically, correct buckets and all title fees start
with ″Title – ″) in Closing Cost Details section. |
| ● | Any
addenda found in file listing ADDITIONAL fees for sections other than Section C (Services
You Can Shop For) is completed properly. |
| ● | Calculating
Cash to Close table completed accurately. |
| ● | Summaries
of Transaction section completed accurately |
| ● | Loan
Disclosures section complete: |
| ○ | CD
Assumption, Demand Feature, Negative Amortization, and Partial Payments sections completed
properly (at least and only one box selected). |
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| ○ | Late
Payment completed properly (terms disclosed and accurate per note). |
| ○ | Escrow
Amount section completed properly (only one box selected and amounts disclosed). |
| ■ | Escrow
Property Costs over Year 1 to be calculated per the payments scheduled to be made in
a 1 year period after consummation (1026.38)(I)(7)(i)(A)(1). |
| ■ | Non-Escrowed
Property Costs over 1 Year to be calculated using either 11 or 12 months as determined
by client. (1026.38)(I)(7)(i)(B)(1) |
| ● | If
Interest Only, Optional Payments, Step Payments, or Seasonal Payments, is Adjustable
Payment (″AP″) Table disclosed accurately. |
| ● | If
ARM or Step, is Adjustable Interest Rate (″AIR″) Table disclosed accurately. |
| ● | Loan
Calculations section complete and accurate. |
| ○ | Total
of Payments is accurate per 1026.38(o)(1). |
| ■ | Include
fees in section A, B, and C that are paid by the borrower as well as the seller or other
if those fees are customarily paid by the borrower. |
| ○ | Capture
amounts disclosed in Loan Calculations section and test for TILA tolerance violations
on disclosed APR and Finance Charge. |
| ○ | Total
Interest Percentage (TIP) accurate with proper rounding. |
| ■ | Other
Disclosures section complete with at least one choice selected as applicable. |
| ■ | Review
for the creditor’s selection of one of the two options in the Liability After Foreclosure
section, but will not make an independent judgment whether or not the selection is correct
for the property state. Only issue a condition if either no selection is made or if both
selections are made. |
| ■ | Contact
Information section is complete with information from each party of the transaction provided
as applicable. |
| ■ | Rounding
rules verified as per 1026.38(t)(4). Rounding on all percentages except APR is percentages should be truncated so that a zero
is not disclosed in the last decimal place (7.250 should be rounded to 7.25). |
TRID
Method of Receipt Of LE And CD
Determine
the method of receipt of the revised LE and CD and perform a compliance test with timing requirements. For purposes of the review
and verification, the date the borrower is deemed to have received the disclosure(s) is based on any of the following methods:
| ● | In
Person: borrower signature date is used. |
| ● | Electronic*
- No Receipt Confirmation in File: three (3) business days from later of document issue
date or proof of e-delivery date is used. |
| ● | Electronic*
- With Receipt Confirmation in File, date of receipt confirmation is used. |
| ● | Electronic*
- Delivery confirmation of an email, assuming the borrower(s) have consented to electronic
delivery. |
| ● | Mail
(USPS or other parcel delivery service) – No Receipt Confirmation in File: three
(3) business days from later of document issue date or proof of mailing date is used.
Delivery confirmation, i.e., confirmation that documents have been delivered to the borrower(s)
door. Signature receipt by anyone other than the borrower(s) to the mortgage transaction
constitutes evidence of delivery, not receipt, for the purposes of the receipt requirements. |
Mail
(USPS or other parcel delivery service) – With Receipt Confirmation in File: date of receipt confirmation is used. Delivery
confirmation, i.e., confirmation that documents have been delivered to the borrower(s) door. Signature receipt by anyone other
than the borrower(s) to the mortgage transaction constitutes evidence of delivery, not receipt, for the purposes of the receipt
requirements. Unknown (unable to determine delivery method or unable to verify borrower received disclosures in any other method
than by USPS Mail method): follow the USPS Mail delivery method of three (3) business days from the document issue date. As noted
above, a signature by anyone other than the borrower(s) constitutes evidence of delivery and the method of receipt will be considered
unknown, requiring an additional three (3) days from the date the non-borrower received the documents.
*NOTE:
If disclosures are sent electronically, a finding will be cited if there is no evidence in the file that the borrower consented
to receive disclosures electronically. Default to the three (3) business day mail rule for delivery without the proper documentation
of borrower consent.
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Other
Recommended TRID Compliance Tests
Apply
the following additional compliance tests which were included in the recommended review scope resulting from the 2015 CFPB Amendments:
| ● | Use
of TRID forms prior to TRID effective date: a finding will be cited if the new TRID forms
are utilized on a loan with an application received prior to the October 3, 2015 effective
date. |
| ● | Use
of TRID forms on loans not covered by TRID: a finding will be cited if the new TRID forms
are utilized on loans not covered by TRID (i.e., HELOC, i.e. reverse mortgages, i.e.
Chattel Dwelling loans (loans on mobile homes that are not also secured by the underlying
real property or loans on houseboats). |
| ● | Your
Home Loan Toolkit: a finding will be cited if the new Your Home Loan Toolkit Disclosure
or evidence the disclosure was delivered or placed in the mail is not in the file or
was not provided to the borrower within three (3) business days of application. |
| ● | Consummation
Date: Consummation varies by applicable state law and the term is not often clearly defined.
Accordingly, generally use the notary date. If there are multiple borrowers and they
do not all sign the documents on the same day, then use the latest signature date. |
| ● | Post-Consummation
Disclosures: TRID review scope will not include testing for compliance with the following
post-consummation disclosures under TRID: |
(a)
Escrow Closing Notice; and
(b)
Mortgage servicing transfer and partial payment notices.
Subsequent
Changes After Consummation
The
following prescribed cures as set forth in section 1026.19 (f)(2)(iii) through (v) are acceptable for changes and corrections
to the Final CD after consummation.
1026.19(f)(2)(iii)
– Changes due to events occurring after consummation.
| ● | If
within 30 days of consummation, an event in connection with the settlement of the transaction
occurs that causes the final CD to become inaccurate and such inaccuracy results in a
change to an amount actually paid by the borrower(s) from the amount disclosed, test
for evidence that a new, corrected CD is delivered or placed in the mail to the borrower
within thirty (30) days of receiving information that an event occurred. |
1026.19(f)(2)(iv)
– Changes due to clerical errors.
| ● | Non-numeric
clerical errors, for the purpose of this scope document are any error not related to
a disclosed dollar amount or percentage. Test for evidence a new, corrected CD is delivered
or placed in the mail to the borrower within sixty (60) calendar days of consummation.
Examples of non-numeric clerical errors include but are not limited to: |
| ○ | Corrections
to the closing information section. |
| ○ | Corrections
to the transaction information section. |
| ○ | Corrections
to loan id # or MIC #. |
| ○ | Corrections
to non-numeric identifiers in the Estimated Taxes, Insurance & Assessments section. |
| ○ | Corrections
to the fee labels and/or order of fees. |
| ○ | Corrections
to the location of the fee(s). |
| ○ | Corrections
to missing cure language. |
| ○ | Corrections
to the “Did This Change” section of Calculating Cash to Close. |
| ○ | Corrections
to the Loan Disclosures section |
| ○ | Corrections
to non-numeric items in the Escrow Account section. |
| ○ | Corrections
to the Other Disclosures section. |
| ○ | Corrections
to the Contact Information section. |
| ● | 1026.19(f)(2)(v)
– Refunds related to the good faith analysis. |
| ○ | Test
for evidence such as a copy of the refund check, a new corrected CD, and evidence the creditor delivered or placed in the mail
to the borrower within sixty (60) calendar days of consummation. |
A
post-consummation CD is understood to be a re-issued CD with a Date Issued represented as the date the post-consummation CD was
issued. Corrections to the final pre-close CD should not be accepted as a post-consummation CD noted in the prescribed cures above.
Errors
on LE’s and Interim CD’s and numeric errors on final CD’s do not have prescribed cures as per the regulation
and therefore will not be reported as having been cured. The assessment of risk and decision to accept a finding that does not
have a prescribed cure is the responsibility of the purchaser of the loan.
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Additional
Disclosures and Requirements:
Consultant
will confirm compliance with current documentation and timing requirements in effect at origination of the Mortgage Loan including:
| ● | Servicing
Transfer Disclosure (for applications prior to 10/03/2015): |
| ○ | Confirm
the presence of the Servicing Transfer Disclosure form in file |
| ○ | Verify
the Servicing Transfer Disclosure was provided to the borrower(s) within three general
business days of “Application” |
| ● | Special
Information Booklet (for applications prior to 10/03/2015)/ Home Loan Tool Kit (for applications
on or after 10/03/2015): |
| ○ | Confirm
the presence of the Home Loan Tool Kit is in file for covered loans. |
| ○ | Confirm
the Home Loan Tool Kit is provided within three general business days of application |
| ● | Affiliated
Business Disclosure |
| ○ | Confirm
the presence of the Affiliated Business Disclosure in file in the event the lender has
affiliated business arrangements |
| ○ | Confirm
the Affiliated Business Disclosure provided within three general business days of “Application”
(Consultant reviews for this disclosure to be provided within three general business
days, as the lender will typically know at the time of application if borrower(s) will
be referred to affiliates for provision of third party services) |
| ○ | Confirm
the Affiliated Business Disclosure is executed. |
| ● | Initial
Escrow Disclosure Statement |
| ○ | Confirm
the presence of the Initial Escrow Disclosure Statement in file |
| ○ | Confirm
the Initial Escrow Disclosure Statement was provided at closing or within 45 days after
settlement |
Equal
Credit Opportunity Act (Regulation B)
| ● | Confirm
the lender has provided the borrower a disclosure of the right to receive a copy of appraisals
within three (3) business days of application. This disclosure requirement may be met
by disclosure on the Loan Estimate pursuant to 12 CFR § 1026.27(m)(1). |
| ● | Confirm
that the lender has provided (delivered) copies of appraisals and all other written valuations
(as disclosed to the borrower on the HUD-1 and/or contained in the Mortgage Loan File)
to the borrower at least three (3) business days prior to consummation Opus uses the
following test: Was appraisal/valuation documentation processed at least 6 days prior
to account opening/ consummation date (3 day rule plus 3 days mailing time)? |
| ● | For
a borrower that has waived the 3-business day disclosure requirement, confirm that the
borrower has either (1) signed the waiver at least three (3) business days prior to consummation
or (2) has signed an acknowledgment that the waiver occurred at least three (3) business
days prior to consummation. Additionally, confirm that the lender has provided copies
of appraisals and other written valuations at or prior to consummation. |
Fair
Credit Report Act (Regulation V)
| ● | Confirm
that the lender has provided the borrower the risk-based pricing notice (as required
by 12 CFR § 1022.73) or credit score disclosure (as required by 12 CFR § 1022.74(d)),
as applicable; (a) If the lender has provided the risk-based pricing notice, confirm
the disclosure was provided before consummation, but not earlier than the approval decision
was communicated to the consumer; and (b) If the lender has provided the credit score
disclosure, confirm the disclosure was provided before consummation. |
| ● | Confirm
that the lender has provided a copy of the disclosure of credit score and the Notice
to Home Loan Applicant (as required by 15 U.S.C. § 1681g) before consummation. |
High-Cost,
State & Local Anti-Predatory Regulations
In
addition to federal thresholds, Consultant will review the anti-predatory lending statutes in the following states and local municipalities,
as applicable, as well as any additional applicable regulations implemented during the Term of this SOW.
| ● | Arkansas
Home Loan Protection Act, Ark. Stat. Ann. § 23-53-101 et seq. |
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| ● | California
Anti-Predatory Lending Statute, Cal. Fin. Code § 4970 et seq. |
| ● | California
Higher-Priced Mortgage Loan Statute, Cal. Fin. Code §4995 et seq. |
| ● | Colorado
Consumer Equity Protection Act, Colo, Rev. Stat. § 5-3.5-101 et seq..
|
| ● | Connecticut
Abusive Home Loan Lending Practices Act, Conn. Stat. Ann. §36a- 746 et seq., as
amended from time to time. |
| ● | Connecticut
Nonprime Home Loans Statute, Conn. Gen. Stat. §§ 36a-760 et seq. (as originally
enacted and as amended by Senate Bill 949). |
| ● | District
of Columbia Home Loan Protection Act, D.C. Official Code § 26-1151.01 et seq., as
implemented by 20 D.C. Municipal Reg § 2000.1 et seq. |
| ● | Florida
Fair Lending Act, Fla. Stat. Ann. § 494.0078 et seq. (for loans closed before July
1, 2014). |
| ● | Georgia
Fair Lending Act, Ga. Stat. Ann. § 7-6A-1 et seq. (as originally enacted by House
Bill 02-1361 and as modified by Senate Bill 03-53). |
| ● | Idaho
Residential Mortgage Practices Act, Idaho Code § 26-3101 et seq. |
| ● | Illinois
High Risk Home Loan Regulations, 38 Ill. Admin. Code §345.10 et seq. |
| ● | Illinois
High Risk Home Loan Act, Public Act. 93-0561 (2003) codified at 815, ILCS §§
137/5 et seq., and as amended by SB 1692 (2012), effective January 10, 2014. |
| ● | Illinois
Predatory Lending Database Program, Public Act 95-0691 (SB 1167). |
| ● | City
of Chicago, Illinois, Anti-Predatory Lending Ordinance, Chicago Municipal Code, §§
2-32-440; 2-32-455; 2-92-325; 4-4-155; 8-4-325. |
| ● | Cook
County, Illinois, Anti-Predatory Lending Ordinance, Cook County Code of Ordinances §
34-341. |
| ● | Cook
County, Illinois, Anti-Predatory Lending Pilot Program, Illinois House Bill 4050 (2005).
|
| ● | Indiana
Home Loan Practices Act, as amended by HB 1179 (2005), Ind. Code § 24-9-1 et seq.
|
| ● | Section
16a-3-308a of the Kansas Consumer Credit Code, Kan. Stat. Ann. §16a.101 et seq.
|
| ● | Kentucky
Anti-Predatory Lending Statute, Ky. Rev. Stat. § 360.100 et seq. |
| ● | Maine,
An Act to Enhance Consumer Protections in Relation to Certain Mortgages (for loans closed
prior to September 27, 2011), Me. Rev. Stat. Ann. Tit. 9-A, §§ 8-103(1); 8-206(8);8-206A,
as amended by Legislative Documents 1869 (2007), 2125 (2008) and 1439 (2009). |
| ● | Maine
Consumer Credit Code - Truth-in-Lending, (for loans closed on or after September 27,
2011), Me. Rev. Stat. Ann. tit. 9-A, §§ 8-501 et seq., as amended from time
to time. |
| ● | Maryland
Commercial Law, Md. Code Ann., Com. Law §§ 12-124.1; 12-127; 12- 409.1; 12-1029.
|
| ● | Maryland
Regulations for Higher Priced Mortgage Loans, as promulgated under the Maryland Mortgage
Lender Law, Md. Code Ann., Fin. Instit. Code §§ 11-501 et seq.; Md.
Code Regs. §§ 09.03.06.01 et seq. |
| ● | Massachusetts
High-Cost Mortgage Regulations, 209 CMR Parts 32 and 40, as amended from time to time.
|
| ● | Massachusetts
Predatory Home Loan Practices Act, M.G.L. Chapter 183C, §§ 1 et seq. |
| ● | Massachusetts
“Borrower’s Interest” Standard, M.G.L. Chapter 183, §28C. |
| ● | Massachusetts
Mortgage Lender and Broker Regulations, 940 CMR §800 (15-17). |
| ● | Massachusetts
Regulations for Higher Priced Mortgage Loans, 209 CMR §§ 32.00 et.seq., as
amended from time to time. |
| ● | Massachusetts
Subprime ARMs to First Time Homebuyers, M.G.L. Chapter 184, §17B.5. |
| ● | Michigan
Consumer Mortgage Protection Act, Mich. Stat. Ann. § 445-1631 et seq. |
| ● | Minnesota
Mortgage Originator and Service Licensing Act, § 58.137 et seq. (S.F. 2988 (2002)),
as amended by House File 1004 (2007) and Senate File 988 (2007). |
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| ● | Nebraska
Mortgage Bankers Registration and Licensing Act, Neb. Stat § 45-702 et seq. |
| ● | Nevada
Anti-Predatory Lending Law, Assembly Bill No. 284 (2003) and Amended by Assembly Bill
No. 440 (2007), codified as NRS § 598D.010 et seq. |
| ● | New
Jersey Home Ownership Security Act of 2002, NJ Stat. Ann. § C:46:10B-22 et
seq., as amended from time to time. |
| ● | New
Mexico Home Loan Protection Act, Senate Bill 449 (Regular Session 2003), codified at
NM Rev. Stat. § 58-21A-1 et seq. and as amended from time to time. |
| ● | New
York High-Cost Home Loan Regulations, 3 NYCCR Part 41 (2001). |
| ● | New
York High-Cost Home Loan Act, N.Y. Bank. L. Ch. 626., as codified in NY Bank. Law §
6-l, and as implemented by 3 NYCCR Part 41 as amended from time to time. |
| ● | New
York Subprime Home Loans Statute, NY Bank. Law § 6-m. |
| ● | North
Carolina Anti-Predatory Lending Law, N.C. Gen. Stat. §§ 24-1.1A to 24- 10.2
and North Carolina Amendments to Anti-Predatory Lending Law, N.C. Gen. Stat. §§
24-9; 24-1.1(E)(a); 24-10.2(a), as amended from time to time. |
| ● | Ohio
Anti-Predatory Lending Statute, HB 386 as amended by Senate Bill 185 (2006), and as codified
in various sections of the Ohio Code. |
| ● | Ohio
Consumer Sales Practices Act, Ohio Rev. Code Ann. § 1345.01, as implemented
by Ohio Admin. Rules § 109 4-3-01 et seq. |
| ● | City
of Cleveland Heights, Ohio, Anti-Predatory Lending Ordinance, Ordinance
No. 72-2003 (PSH), Mun. Code §§ 757.01 et seq. |
| ● | Summit
County, Ohio, Anti-Predatory Lending Ordinance, Ordinance No. 2004- 618, Muni.
Code §§ 201.01 et seq. |
| ● | Oklahoma
Anti-Predatory Lending Law, House Bill No. 1574 (2003), as codified in various sections
of Title 14A of the Oklahoma Consumer Credit Code. |
| ● | Oklahoma
Higher-Priced Mortgage Loans Law, Okla. Admin. Code §§ 160:45-9-1 et
seq. |
| ● | Pennsylvania
Consumer Equity Protection Act, 63 Pa. Cons. Stat. Ann. § 456.501 et seq. |
| ● | Rhode
Island Home Loan Protection Act, R.I. Gen. L. 34-25.1-2 et seq, as implemented by Emergency
Banking Regulation 3 (2006) and Final Banking Regulation 3 (2007) and amended by Senate
Bill 371 (2007). |
| ● | City
of Providence, Rhode Island, Anti-Predatory Lending Ordinance, Chapter 2006-33, Ordinance
No. 245. |
| ● | South
Carolina High-Cost and Consumer Home Loans Act, S.C. Code § 37-23-10 et seq. |
| ● | Tennessee
Home Loan Protection Act, Tenn. H.R. 3597 (2006), as codified at Tenn. Code Ann. §§
45-20-101 et seq. |
| ● | Texas
High-Cost Home Loan Statute, Tx. Fin. Code Ann. § 343.201 et seq. |
| ● | Section
50(a)(6), Article XVI of the Texas Constitution |
| ● | Section
50(f)(2), Article XVI of the Texas Constitution |
| ● | Utah
Residential Mortgage Practices Amendments, Utah Code Ann. § 61-2c-102 et seq. |
| ● | Utah
High-Cost Home Loan Act, Utah Code § 61-2d-101 et seq. |
| ● | Vermont
Interest Act, 9 V.S.A. § 104, implemented by Regulation B-98-2. |
| ● | Virginia
Mortgage Lender and Broker Act (for loans originated prior to July 1, 2003), Va. Code
Ann. §§ 6.1-413; 6.1-422; 6.1-428. |
| ● | Virginia
Mortgage Lender and Broker Act (for loans originated on or after July 1, 2003 to September
30, 2010, as amended), Va. Code Ann. §§ 6.1-411, 6.1-422.1, 6.1-425.1 and 6.1-425.2.
|
| ● | Virginia
Mortgage Lender and Broker Act (for loans originated on or after October 1, 2010), Va.
Code Ann. §§ 6.2-1600 et seq., as amended from time to time. |
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| ● | Virginia
Senate Bill 797 (2008), effective July 1, 2008 (uncodified). |
| ● | West
Virginia Residential Mortgage Lender, Broker and Servicer Act, W.Va. Code § 31-17
et seq. |
| ● | Wisconsin
Responsible High-Cost Mortgage Lending Act, Wis. Stat. § 428.202, as implemented
by Wis. Admin. Code DFI-Bkg 46.01 et seq. |
Flood
Insurance Testing
National
Flood Insurance Program (NFIP)
Each
mortgage loan will be reviewed to ensure adherence to flood insurance coverage requirements as outlined under the NFIP, including
identification of flood zones and subsequent policy documentation for evidence of adequate coverage amounts.
Homeowner’s
Flood Affordability Act (HFIAA)
Each
mortgage loan made by an FDIC-supervised institution or servicer acting on its behalf shall require the escrow of all premiums
and fess for flood insurance for any designated loan secured by residential improved real estate or a mobile home, made, increased,
extended or renewed on or after January 1, 2016.
Frequency
– Payable with same frequency as payments designated for the loans
Exceptions
| ● | Loan
is an extension of credit primarily for business, commercial or agricultural purposes |
| ● | Loan
is in a subordinate position to a senior lien secured by the same residential improved
real estate or mobile for which the borrower has obtained flood insurance |
| ● | Flood
Insurance coverage for the residential real estate is provided by a policy that |
| b. | Provided
by a condominium association, cooperative or other applicable group and |
| c. | The
premium for which is paid by the condominium associate, cooperative, homeowners association,
or other group as a common expense. |
Misrepresentation
and Third-Party Review
Validate
that fraud reports and independent third-party property valuations reports are in the file. The review will consist of the following:
1)
Misrepresentation Review and Valuation Review
Review
on each loan to identify potential misrepresentations of income, employment, identity, occupancy, transaction and appraisal misrepresentation
or other areas of potential misrepresentation. The Misrepresentation may include the following:
| ● | Signatures:
Validate signature consistency across documents. To the extent imaged or hard copy files
are provided, Consultant will utilize reasonable efforts to validate the consistency
of signatures across documents. |
| ● | Alerts:
Assess credit report alerts for accuracy and potential issues. |
| ● | Social
Security Numbers: Compare SSN(s) across all file documents. |
| ● | Document
Integrity: Review for apparent alterations to loan documents. To the extent imaged or
hard copy files are provided, Consultant will utilize reasonable review of alterations
to the loan documents. |
| ● | Data
Consistency: Review the documents contained in the loan file for consistency of data. |
| ● | Third
Party Fraud Tools: To the extent a third party fraud tool is contained in the loan file, the Consultant will ensure high level
or critical warnings are reviewed and addressed. |
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Independent
Third-Party Values
Review
each loan to determine whether a third party valuation product was required and if required, that the third party product value
was compared to the original appraised value to identify a value variance and apply the appropriate rating agency grade after
reviewing the required valuation products. i) Consultant will perform the following steps.
| ● | Value
is based on as-is condition or provides satisfactory completion of all material conditions
including inspections, licenses, and certifications (including certificates of occupancy)
to be made or issued with respect to all occupied portions of the mortgaged property
and with respect to the use and occupancy of the same, have been made or obtained from
the appropriate authorities. |
| ● | Property
is described in average or better condition |
| ● | No
apparent appraiser independence violation statements |
| ● | Appraisal
addresses any adverse comments |
| ● | Appraisal
is completed on appropriate GSE Forms |
| ● | Appraisal
contains required attachments. |
| ● | Appraiser
was appropriately licensed at the time the appraisal was signed |
If
the valuation vendor des not supply the updated valuation product directly to the Consultant, the Client will authorize the valuation
vendor to issue an attestation with sufficient information for the Consultant to determine the correct valuation product was utilized
to verify the accuracy of the origination appraisal.
Value
Review Disclaimer
| ● | The
individuals performing the above procedures are not person providing valuations for the
purpose of the Uniform Standards of Professional Appraisal Practice (“USPAP”)
or necessarily licensed as appraiser under Federal or State law, and the services being
performed do not constitute appraisal reviews for the purposes of USPAP or Federal or
State law. |
| ● | Opus
makes no representation or warranty as to the value of the mortgaged property, notwithstanding
that Opus may have reviewed the valuation information for reasonableness. |
| ● | Opus
is not an Appraisal Management Company (“AMC”) and therefore does not opine
on the actual value of the underlying property. |
| ● | Opus
is not a creditor within the meaning of the Equal Credit Opportunity Act (“ECOA”)
or other lending laws and regulations, and therefore Opus will not have and communications
with or responsibility to any individual concerning property valuations. |
Properties
in FEMA declared disaster zones.
If
a FEMA declared disaster occurs after the inspection date on the appraisal, Consultant will review the file to determine if an
exterior inspection to ensure:
| ● | No
apparent damage to the property |
| ● | Property
appears to be occupied |
Data
Compare
Client
will provide a data tape with the following data fields and Consultant will compare the field to the applicable source document
and report any variance
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| ● | Second
Mortgage Lien Amount |
Rating
Agency Grading Criteria
Fitch
Ratings Grading Criteria
Grading
shall be provided for each exception, each exception category and holistically for each loan. The methodology for the application
of the RMBS grading as defined by Fitch in their current industry publications as updated from time to time.
Moody’s
Investor Services Grading Criteria
Grading
shall be provided for each exception, each exception category and holistically for each loan. The methodology for the application
of the RMBS grading as defined by Moody’s in their current industry publications as updated from time to time.
Kroll
Bond Rating Agency LLC Grading Criteria
Grading
shall be provided for each exception, each exception category and holistically for each loan. The methodology for the application
of the RMBS grading as defined by Kroll in their current industry publications as updated from time to time.
S&P
Global Ratings Grading Criteria
Grading
shall be provided for each exception, each exception category and holistically for each loan. The methodology for the application
of the RMBS grading as defined by Standard & Poor’s in their current industry publications and updated from time to
time.
DBRS
Morningstar Grading Criteria
Grading
shall be provided for each exception, each exception category and holistically for each loan. The methodology for the application
of the RMBS grading as defined by DBRS in their current industry publications and updated from time to time.
Opus
Grading Criteria
1)
Opus Grading Criteria
Grading
shall be provided for each exception, each exception category and holistically for each loan. The following grading is not intended
for securitization reviews and Opus will not issue a Rating Agency Narrative, Reliance or Form ABS Due Diligence 15E if Client
elects to utilize the following grading criteria. The methodology for the application of grading is defined by Opus and updated
from time to time shall be determined as follows:
Opus
Credit Grades
| ● | Level
1 Credit Grade Definition: Loan was originated in accordance with the mortgage loan originator
underwriting guidelines without exception. |
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| ● | Level
2 Credit Grade Definition: Loan was originated in substantial compliance with the originator’s
underwriting guidelines and there are sufficient compensating factors for any exceptions. |
| ● | Level
3 Credit Grade Definition: Loan was not originated in substantial compliance with the originator’s underwriting guidelines
and there are insufficient compensating factors for the exceptions or is missing material documentation. |
Opus
Property Grades
| ● | Level
1 Property Grade Definition: Property value appears to be within 10% of original appraised
amount and there are no material deficiencies in the appraisal process. |
| ● | Level
2 Property Grade Definition: Property value appears to be within 10% of original appraised
amount, but minor issues in the appraisal process were identified. |
| ● | Level
3 Property Grade Definition: Property value does not appear to fall within 10% of the original appraised value and/or material
deficiencies exist with respect to the appraisal process or the file is missing material documentation. |
Opus
Compliance Grades
| ● | Level
1 Compliance Grade Definition: Loan complies with all applicable laws and regulations
reviewed under the applicable scope of work. |
| ● | Level
2 Compliance Grade Definition: There are minor issues regarding legal and/or regulatory
compliance but such issues do not represent risks to the enforceability of the borrower’s
obligation under the loan documents and will not result in assignee liability to the
investor. |
| ● | Level
3 Compliance Grade Definition: Loan is not in compliance with laws and regulations reviewed
under the applicable scope of work or the loan is missing material documentation. |
REDACTED
INFORMATION
| ● | Property
Address, City, County, MSA, Zip |
| ● | Account
Number, including Originator and Servicer Loan Number |
| ● | Names
of Borrowers or any other Individuals |
| ● | Company
and Entity Names |
| ● | Financial
Institution Names |
| ● | Any
Location Information (other than state), including City, County, MSA and Zip |
| ● | Account
Numbers of any type |
| ● | Insurance
Policy Numbers |
| ● | Foreclosure
Action dates and Case Numbers |
| ● | Bankruptcy
Action dates and Case Numbers |
| ● | Any
reference that would allow the identification of the location of a property (e.g. neighborhood,
body of water, schools, major highways) |
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EXHIBIT
B
COMPLIANCE
REVIEW SCOPE
Regulatory
Compliance: Each mortgage loan file will be subject to a post-closing regulatory compliance review to verify that each mortgage
loan closed in compliance with the applicable federal, state and local anti-predatory lending statutes in effect at the time of
origination of the Mortgage Loan and that the loans meet the applicable disclosure requirements provided under the federal Truth
in Lending Act (“TILA”), as amended by HOEPA, 15 U.S.C. § 1601 et seq., as implemented by Regulation Z, 12 C.F.R.
Part 226; (ii) the disclosure requirements and prohibitions of Section 50(a)(6), Article XVI of the Texas Constitution and associated
regulations; and (v) the disclosure requirements and prohibitions of the applicable state, county and municipal laws and ordinances
that were enacted to combat predatory lending including:
| ✓ | Violations
of the Federal Truth in Lending Act/ Regulation Z: Includes a review of the material
compliance disclosures set forth in the Truth in Lending Disclosure and the Notice of
Right to Cancel, if applicable. |
|  | Review
of the Final TIL for the following: Re-calculation of disclosed finance charge, Proper
execution by all required parties, Principal and interest calculations, Payment stream(s),
Recalculation of disclosed APR. |
| | Review
of the Notice of Right to Cancel: Verification of the transaction date, Verification
of the expiration date, Proper execution of the Notice of Right to Cancel by all required
parties, Verification of disbursement date. |
| ✓ | Review
of the Final HUD-1: Verification of prepaid finance charges, Verification of interest
per diem and/or disbursement date, Proper execution, if applicable. |
| ✓ | Section
32/HOEPA. Review includes but is not necessarily limited to: |
| | APR
test |
| | HPML
test |
| | Points
and Fees test |
| | Review
of Section 32 disclosure for accuracy (i.e. payment stream, highest payment scenario;
dates disclosed, dates acknowledged) |
| | Review
and confirm documentation type (i.e. full, stated, no ratio) |
| | Review
for evidence of prepayment penalty |
| ✓ | High
Cost - State & Local Anti-Predatory Regulations: In addition to federal thresholds,
the Consultant will review the anti-predatory lending statutes in the following states
and local municipalities, as applicable, as well as any additional applicable regulations
implemented during the Term of this SOW: |
| | Arkansas
Home Loan Protection Act, Ark. Stat. Ann. § 23-53-101 et seq. |
| | California
Anti-Predatory Lending Statute, Cal. Fin. Code § 4970 et seq. |
| | Colorado
Consumer Equity Protection Act, Colo. Rev. Stat. § 5-3.5-101 et seq. and as amended
by Senate Bill 216 (2007) and House Bill 1322 (2007). |
| | Colorado
Consumer Credit Code, Colo. Rev. Stat. 5-1-101 et seq. |
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| | Connecticut
Abusive Home Loan Lending Practices Act, Conn. Stat. Ann. §36a-746 et seq. and the
Responsible Lending and Economic Security Act, Conn. House Bill 5577 (2008). |
| | District
of Columbia Home Loan Protection Act of 2002, D.C. Official Code § 26-1151.01 et
seq., as implemented by 20 D.C. Municipal Reg. § 2000.1 et seq. as well as DC Mortgage
Disclosure Act of 2007. |
| | Florida
Fair Lending Act, Fla. Stat. Ann. § 494.0078 et seq. |
| | Georgia
Fair Lending Act, Ga. Stat. Ann. § 7-6A-1 et seq. (as originally enacted by House
Bill 02-1361 and as modified by Senate Bill 03-53) |
| | Idaho
Residential Mortgage Practices Act, Idaho Code § 26-3101 et seq. |
| | Illinois
High Risk Home Loan Regulations, 38 Ill. Admin. Code § 345.10 et seq. |
| | Illinois
High Risk Home Loan Act, Public Act. 93-0561 (2003). |
| | City
of Chicago, Illinois, Anti-Predatory Lending Ordinance, Chicago Municipal Code, §§
2-32-440; 2-32-455; 2-92-325; 4-4-155; 8-4-325. |
| | Cook
County, Illinois, Anti-Predatory Lending Ordinance, Ordinance No. 240864 (2001) as amended
by Illinois SB 1167 (2007). |
| | Indiana
Home Loan Practices Act, Ind. Code § 24-9-1 et seq. |
| | Section
16a-3-308a of the Kansas Consumer Credit Code, Kan. Stat. Ann. § 16a-1-101 et seq.
16. Kentucky Anti-Predatory Lending Statute, Ky. Rev. Stat. § 360.100 et seq. and
as amended by Kentucky House Bill 552 (2008). |
| | Maine,
An Act to Enhance Consumer Protections in Relation to Certain Mortgages, 9A Me. Rev.
Stat. Ann. §§ 8-103(1); 8-206(8); 8-206A and Maine Legislative Document 1869
(2007). |
| | Maryland
Commercial Law, Mary. Stat. Ann. §§ 12-124.1; 12-127; 12-409.1; 12-1029 and
as amended by Maryland Senate Bill 270 (2008) and Maryland Regulations under the Maryland
Mortgage Lender Law (2009). |
| | Massachusetts
High Cost Mortgage Regulations, 209 CMR § 32.32 et seq. including MA House Bill
4387 (2008) 20. Massachusetts Predatory Home Loan Practices Act, M.G.L. Chapter 183(C). |
| | Massachusetts
“Borrower’s Interest” Standard, M.G.L. Chapter 183, §28C. |
| | Michigan
Consumer Mortgage Protection Act, Mich. Stat. Ann. § 445-1631 et seq. |
| | Minnesota
Mortgage Originator and Service Licensing Act, § 58.137 et al. (S.F. 2988 (2002)
and as amended by House File 1004 and SF 98 (2007) and SF 3154 and 3214 (2008). |
| | Nebraska
Mortgage Bankers Registration and Licensing Act, Neb. Stat.§ 45-702 et seq. |
| | Nevada
Anti-Predatory Lending Law, Nev. Rev. Stat. § 598D.010 et seq. and as amended by
AB 440. |
| | New
Jersey Home Ownership Security Act of 2002, NJ Stat. Ann. § C:46:10B-22 et seq. |
| | New
Mexico Home Loan Protection Act, N.M. Stat. Ann. § 58-21A-1 et seq. and as amended
by Senate Bill 342 (2009). |
| | New
York High Cost Home Loan Regulations, 3 NYCCR Part 41 (2001). |
| | New
York High Cost Home Loan Act, N.Y. Bank. L. Ch. 626., as implemented by 3 NYCCR Part
41 (2003) and as amended by Senate Bill 8143-A (2008). |
| | North
Carolina Anti-Predatory Lending Law, N.C. Gen. Stat. §§ 24-1.1A to 24-10.2
and North Carolina Amendments to Anti-Predatory Lending Law, N.C. Gen. Stat. §§
24-9; 24-1.1(E)(a); 24-10.2(a) and as amended by House Bill 1817 (2007). |
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| | Ohio
Anti-Predatory Lending Statute, Ohio Rev. Code Ann. § 1.63 and as amended by S.B.
185. |
| | City
of Cleveland Heights, Ohio, Anti-Predatory Lending Ordinance, Ordinance No. 72-2003. |
| | Oklahoma
Anti-Predatory Lending Law, House Bill No. 1574 (2003). |
| | Pennsylvania
Consumer Equity Protection Act, 63 Pa. Cons. Stat. Ann. § 456.501 et seq. |
| | City
of Providence, Rhode Island Predatory Lending Ordinance, Ordinance No. 245, Chapter 2006-33
as amended. |
| | Rhode
Island Home Loan Protection Act, Chapter 25.2 of Title 34 of RI Gen. L. et seq., including
the Emergency and Final Regulations. |
| | South
Carolina High-Cost and Consumer Home Loans Act, S.C. Code § 37-23-10 et seq. |
| | South
Carolina Consumer Protection Code, S.C. Code 37-1-101 et seq |
| | Tennessee
Home Loan Protection Act of 2006, TN Code Annotated, Title 47 et seq. |
| | Texas
High-Cost Home Loan Statute, TX. Fin. Code Ann. § 343.201 et seq. |
| | Utah
Residential Mortgage Practices Amendments, Utah Code Ann. § 61- 2c-102 et seq. |
| | Utah
High Cost Home Loan Act, Utah Code § 61-2d-101 et seq. |
| | Vermont
Interest Act, 9 V.S.A. § 104, implemented by Regulation B-98-2. |
| | Virginia
Mortgage Lender and Broker Act (for loans originated prior to July 1, 2003), Va. Code
Ann. §§ 6.1-413; 6.1-422, 6.1-428. |
| | Virginia
Mortgage Lender and Broker Act (for loans originated after July 1, 2003), Va. Code Ann.
§§ 6.1-411; 6.1-422.1, 6.1-425.1; 6.1-425.2. |
| | Washington
House Bill 2770, Mortgage Lending and Homeownership, Chapter 108, Laws of 2008. |
| | Wisconsin
Responsible High Cost Mortgage Lending Act, Wis. Stat. § 428.202. |
| | West
Virginia Residential Mortgage Lender, Broker and Servicer Act, W.Va. Code § 31-17-1
et seq. |
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Loan
Details for credit and compliance loan
| Purpose |
|
|
|
|
|
| Type |
Count |
% of Pool |
|
|
|
| Cash out Refi |
62 |
26.84% |
|
|
|
| Purchase |
75 |
32.47% |
|
|
|
| Rate / Term Refi |
94 |
40.69% |
|
|
| Total |
231 |
100.00% |
|
|
| |
|
|
|
|
| Property Type |
| Type |
Count |
% of Pool |
| Single Family Detached |
162 |
70.13% |
| Co-op |
0 |
0.00% |
| Condo, Low Rise |
5 |
2.16% |
| Condo, High Rise |
2 |
0.87% |
| PUD |
47 |
20.35% |
| 1 Family Attached |
10 |
4.33% |
| 2 Family |
5 |
2.16% |
| 3 Family |
0 |
0.00% |
| 4 Family |
0 |
0.00% |
| Total |
231 |
100.00% |
| |
|
|
|
|
|
| Occupancy |
| Type |
Count |
% of Pool |
| Primary Residence |
217 |
93.94% |
| Second Home |
14 |
6.06% |
| Investment Property |
0 |
0.00% |
| Total |
231 |
100.00% |
| |
|
|
|
|
| Product Type |
| Type |
Count |
% of Pool |
| Fixed |
231 |
100.00% |
| ARM |
0 |
0.00% |
| Total |
231 |
100.00% |
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Tape
Discrepancies for credit and compliance loan
| Data
Element |
Count |
Accuracy |
| Property
Type |
8 |
96.54% |
| Qualifying
FICO |
2 |
99.13% |
| Total
Loan Population |
231 |
|
Multiple
Loans to One Borrower: TPR firm reviewed common identifiers for all loans in the population and confirmed there were no obligors
with multiple loans in the pool.
Property
Inspection Waivers: One hundred six (106) loans contained Property Inspections Waivers (PIW). 2055 Exterior Only Inspection
Reports (105) and a 1075 Exterior Only Inspection Condo Report (1) were obtained as a secondary product to confirm the value indicated
on the PIW. An initial grade property value grade of a “C” was assigned to the PIW loans. If the secondary product
supported the value indicated on the PIW, a final property grade of a “B” was assigned.
Loan
Grading Definitions
Credit
| S&P |
Moody’s |
Fitch |
Kroll |
DBRS |
Definition |
| A |
A |
A |
A |
A |
Loan
conforms to all applicable guidelines, no conditions noted |
| B |
B |
B |
B |
B |
Loan
does not meet every applicable credit guideline. However, most of the loan characteristics are within the guidelines and there
are documented and significant compensating factors |
| C |
C |
C |
C |
C |
The
loan does not meet every applicable credit guideline, and most of the loan characteristics are outside of guidelines; or there
are weak or no compensating factors |
| D |
D |
D |
D |
D |
The
loan file is missing critical documentation required to perform the review |
Compliance
| S&P |
Moody’s |
Kroll |
DBRS |
Definition |
| A |
A |
A |
A |
The
loan was originated in compliance with applicable federal, state, and local predatory
and high cost, TILA, and Regulation Z laws and regulations |
| B |
B |
B |
B |
The
loan was originated in compliance with applicable federal, state, and local predatory and high cost, TILA, and Regulation
Z laws and regulations; however, minor evidentiary issue(s) exist |
| C |
C |
C |
C |
The
includes material violation(s) with applicable federal, state, and local predatory and high cost, TILA, and Regulation Z laws
and regulations |
| D |
D |
D |
D |
The
loan file is missing critical documentation required to perform the review |
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| Fitch |
Definition |
| A |
The
loan was originated in compliance with applicable federal, state, and local predatory and high cost, TILA, and Regulation
Z laws and regulations |
| B |
The
loan is in compliance with all applicable laws and regulations and a benefit to the borrower is present and documented |
| C |
The
includes material violation(s) with applicable federal, state, and local predatory and high cost, TILA, and Regulation Z laws
and regulations |
| D |
The
loan file is missing critical documentation required to perform the review |
Property
Valuation
| Moody’s |
Fitch |
Kroll |
DBRS |
Definition |
| A |
A |
A |
A |
Value
is within a 10% variance of third party product. Appraisal meets lender guidelines. Subject property is 100% complete. Property
condition is average or better. Standard GSE form was utilized. Appraiser is licensed. Appraisal is complete. |
| B |
B |
B |
B |
Meets
all terms for an A, but property requires cosmetic or minor repairs that do not effect value or habitability |
| C |
C |
C |
C |
Any
of the following items: Origination value and third party valuation product value has a variance of 10% or greater, cannot
validate value, property is incomplete, property condition is less than average, GSE form was not utilized, and/or the appraisal
and/or does not meet guidelines |
| D |
D |
D |
D |
The
loan file was missing the appraisal and/or other valuations products needed to complete the review |
| S&P |
Definition |
| A |
First
Level Review Value is within a 10% variance to the original appraisal. Appraisal meets lender guidelines. Subject property
is 100% complete. Property condition is average or better. Standard GSE form was utilized. Appraiser is licensed. Appraisal
is complete. |
| B |
First
Level Review Value is greater than a 10% variance to the original appraisal but the second level review value is within 10%
variance of the original appraised value. In addition, property requires cosmetic or minor repairs that do not effect value
or habitability |
| C |
Any
of the following items: Second Level Review Value is greater than a 10% variance to the original appraisal, cannot validate
value, property is incomplete, property condition is less than average, GSE form was not utilized, and/or the appraisal and/or
does not meet guidelines |
| D |
The
loan file was missing the appraisal and/or other valuations products needed to complete the review |
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Loan
Review Findings
The
following summarizes Consultant’s initial and final loan securitization and event grades assigned to the final reviewed
loan pool and reported in the Agency Grading Report dated February 4, 2026.
Credit
and Compliance Loan:
| Overall
Grade Summary |
|
|
| Fitch
NRSRO Grade |
#
of Loans |
%
of Loans |
| A |
120 |
51.95% |
| B |
111 |
48.05% |
| C |
0 |
0.00% |
| D |
0 |
0.00% |
| |
|
|
| Compliance
Grade Summary |
|
|
| Fitch
NRSRO Grade |
#
of Loans |
%
of Loans |
| A |
227 |
98.27% |
| B |
4 |
1.73% |
| C |
0 |
0.00% |
| D |
0 |
0.00% |
| |
|
|
| Credit
Grade Summary |
|
|
| Fitch
NRSRO Grade |
#
of Loans |
%
of Loans |
| A |
229 |
99.13% |
| B |
2 |
0.87% |
| C |
0 |
0.00% |
| D |
0 |
0.00% |
| |
|
|
| Property
Grade Summary |
|
|
| Fitch
NRSRO Grade |
#
of Loans |
%
of Loans |
| A |
125 |
54.11% |
| B |
106 |
45.89% |
| C |
0 |
0.00% |
| D |
0 |
0.00% |
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Compliance
Only Loan:
| Compliance
Grade Summary |
|
|
| Fitch
NRSRO Grade |
#
of Loans |
%
of Loans |
| A |
0 |
0.00% |
| B |
8 |
66.67% |
| C |
0 |
0.00% |
| D |
4 |
33.33% |
Loans
Reviewed (243 Loans)
| 767154 |
477767 |
723735 |
302563 |
950551 |
449675 |
595179 |
360928 |
807555 |
| 582099 |
652593 |
802518 |
462038 |
619132 |
424873 |
969482 |
265280 |
803310 |
| 181396 |
641365 |
164403 |
895418 |
667914 |
871506 |
582589 |
724217 |
961511 |
| 519341 |
209113 |
436299 |
983728 |
554938 |
455631 |
979787 |
481621 |
210025 |
| 271243 |
354892 |
194800 |
758152 |
327221 |
990303 |
791910 |
225460 |
243026 |
| 808209 |
970126 |
938635 |
478711 |
715102 |
655688 |
270579 |
423452 |
830705 |
| 683209 |
975576 |
549465 |
930706 |
107318 |
109697 |
112455 |
115321 |
880070 |
| 943339 |
102060 |
126905 |
115606 |
849283 |
209756 |
911425 |
121521 |
761126 |
| 917300 |
806123 |
304477 |
767770 |
575522 |
216797 |
662043 |
482380 |
511654 |
| 125968 |
569024 |
869364 |
809137 |
436604 |
548021 |
205368 |
928195 |
398058 |
| 130105 |
671755 |
247264 |
858158 |
289073 |
381091 |
460314 |
472721 |
341118 |
| 414510 |
855210 |
953245 |
551313 |
535730 |
985695 |
122337 |
577720 |
|
| 795406 |
380761 |
906783 |
721399 |
687390 |
768887 |
301352 |
286179 |
|
| 394063 |
677838 |
840221 |
366614 |
768367 |
771289 |
611814 |
199607 |
|
| 902892 |
833176 |
400591 |
482087 |
328500 |
648098 |
760292 |
491859 |
|
| 995940 |
404370 |
863263 |
372844 |
382059 |
452269 |
579054 |
232609 |
|
| 159930 |
520378 |
237589 |
165208 |
800143 |
870289 |
868606 |
716617 |
|
| 969138 |
496677 |
359467 |
177415 |
895055 |
775917 |
644043 |
595265 |
|
| 348521 |
418663 |
130366 |
128165 |
255094 |
911418 |
605165 |
309374 |
|
| 948251 |
571852 |
500068 |
368549 |
395232 |
777911 |
231887 |
394538 |
|
| 808950 |
798816 |
434956 |
717338 |
835634 |
163557 |
219582 |
640126 |
|
| 439364 |
265259 |
378063 |
798532 |
894675 |
927639 |
483469 |
673512 |
|
| 533837 |
932603 |
929744 |
762576 |
820403 |
174052 |
716899 |
374007 |
|
| 458068 |
203274 |
737831 |
899313 |
794500 |
175399 |
440669 |
661325 |
|
| 383472 |
623901 |
251991 |
693759 |
131007 |
662741 |
305704 |
774991 |
|
| 504502 |
742519 |
305775 |
175663 |
263876 |
481485 |
355020 |
760049 |
|
| 821720 |
787350 |
440578 |
133304 |
887544 |
979933 |
609030 |
422123 |
|
| 654260 |
752520 |
358119 |
423243 |
345281 |
935319 |
405224 |
358949 |
|
| 225973 |
979332 |
581377 |
591756 |
720021 |
579790 |
283161 |
825473 |
|
If
you have any questions, please contact Uriah Clavier at Uriah.Clavier@opuscmc.com
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