Plus: Important TRID Updates for Downpayment Loans
Plus: Important TRID Updates for Downpayment Loans
Impact of New U.S. Bank Underwriting Overlays

New U.S. Bank Overlays
The U.S. Bank HFA Division recently notified housing finance agencies across the country that they are implementing a number of new underwriting overlays.
They anticipate that bulletins explaining the overlays will go out to lenders on November 16. Because these overlays will affect your business, we wanted to alert you as soon as possible. Please know that we are very concerned about these changes and their impact on the borrowers we serve.
Condo Overlay Effective November 15, 2015
On October 15, U.S. Bank announced stricter requirements for condominium units, effective for loans committed on or after November 15, 2015. 
The requirements differ depending upon whether a lender is a Tier III or V lender versus a Tier IV or VI. If you are unsure what tier you are, please contact the U.S. Bank Help Desk.
Overlays for FHA Loan Commitments Effective December 1, 2015
  • Minimum 660 credit score
  • Maximum 45% debt-to-income (DTI) ratio
We will continue to accept manufactured housing and manually underwritten FHA loans that meet underlying product, Minnesota Housing, and U.S. Bank HFA Division guidelines. We will monitor production for these loan types and will notify you if future changes are necessary.
Learn More
Updates to our manuals and program materials are underway. We will notify you when new versions are available.
To learn more about both the U.S. Bank overlays and how to get your downpayment and closing cost loans purchased under TRID, register for a Webinar on Thursday, November 19 from 10-11 a.m.
Important TRID Update for Downpayment and Closing Cost Loans
Get your Minnesota Housing downpayment and closing cost loans purchased under TILA RESPA Integrated Disclosure (TRID) regulation. You can also find this information in a resource guide on our Downpayment and Closing Cost web page.
Deferred Payment Loans
You have three options for Deferred Payment Loans. Minnesota Housing prefers you use Option 1. If you are not able to use Option 1 due to system or other constraints, use Option 2 or 3. 

Barring further guidance from the CFPB during the learning period, all lenders will need to use Option 1 by April 1, 2016. If your company will not be able to use Option 1 by April 1, 2016, please contact Michael Peterson.  

Option 1: TRID Disclosures
You charged a Loan Processing Fee (fee must be at least $10, but no more than $100). The loan was covered by TILA in addition to RESPA. 
Action: Provide the following TRID disclosures to U.S. Bank HFA Division:
  • Loan Estimate
  • Closing Disclosure
Option 2: RESPA Disclosures
You did not charge a loan processing fee and did not use the RESPA partial exemption (12 CFR §1026.3(h) and HUD 1024.5), the loan was not covered by TILA but was covered by RESPA. 
Action: Provide the following RESPA documents to U.S. Bank HFA Division:
  • Good Faith Estimate (GFE)
  • HUD 1
Option 3: Company Generated Disclosures
You used the partial exemption (12 CFR §1026.3(h) and HUD 1024.5), so the loan was not covered by TILA but was covered by RESPA. You are responsible for ensuring the loan meets the 1% fee cap and that no fees in excess of this were charged to the borrower. Eligible fees are recording, application, and homeownership counseling.
Action: Provide a set of disclosures to U.S. Bank HFA Division that includes the elements required by 12 CFR Part §1026.18 (Regulation Z).* We are developing a sample disclosure for optional use with loans that use the partial exemption. We will notify you when it is available.

*Finance charge, APR, Total of payments due, Security interest, and Assumption policy are all covered with a TIL. Itemization of amount financed, terms of repayment, and a reference to the loan contract (NOTE) need to also be disclosed.

Monthly Payment Loans
Monthly Payment Loans are covered under TILA and RESPA and must follow TRID regulation. 
Action: Provide the following TRID disclosures to U.S. Bank HFA Division:
  • Loan Estimate
  • Closing Disclosure
Learn More
To learn more about both the U.S. Bank overlays and how to get your downpayment and closing cost loans purchased under TRID, register for a Webinar on Thursday, November 19 from 10-11 a.m.
Register Today for Greater Minnesota In-Person Training
Join Minnesota Housing for an in-person training in Detroit Lakes for homeownership lenders:
Wednesday, November 18 from 8:30 a.m.-2:30 p.m.
M State Community and Technical College, Detroit Lakes
Sessions include:
  • Introduction to Minnesota Housing Programs
  • Building Better Loans – For loan officers and underwriters
  • Closing Better Loans – For processors, closers and post-closers
  • U.S. Bank Updates and Q & A

Registration is limited - click the link above to register. Questions? Contact Emily Strong at 651.296.3631.

Single Family Division Fax Number
To send a fax to our Partner Solutions Team, please use the Single Family Division’s fax number, 651.296.8292. Mark the fax as attention to either the “Partners Solutions Team” or a specific team member.
Closed on Veterans Day
We are closed on Wednesday, November 11 in observance of Veterans Day. Lenders will be unable to lock new loans between 5:00 p.m. on Tuesday, November 10 and 10:00 a.m. on Thursday, November 12.
Questions? 
Reach the Partner Solutions Team at 651.296.8215 or 800.710.8871 between 7:30 a.m. and 5:00 p.m. on business days.
400 Sibley Street, Suite 300 | Saint Paul, MN 55101 US
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