Compliance Memo C2021-14 DPA/Bond/2nd liens
This memo is clarification in regards to DPA/Bond Programs and 2nd liens and when a 2nd file is needed, fees associated with programs, any additional information you may need.
There has been some confusion as to when 2nd files are needed or what is needed when originating DPA/Bond loans and other 2nd liens associated with the first mortgage.
Attached please find the DPA/Bond Program spreadsheet. Also uploaded in the Knowledge Center under Products. Please review in Knowledge Center for any updates.
DPA/Bond Program Spreadsheet
Below are the columns on the spreadsheet in order:
- Program name
- Program name in Encompass
- If Grant or 2nd lien
- If an LE or CD are required*
- Origination fee and any allowable fee limits (on first)
- Any program fees (on first)
- Any master servicer fees (on first)
- Any fees associated with the second (DPA/Bond)
- Any document requirements
- Lists who funds the DPA/Bond
- DPA loan amount determination
- DPA Master Servicer
- Forgiveness information
*Only DPA/Bond Programs that require a 2nd file are those which require Gold Star to produce an LE or CD. This is reflected in the “If an LE or CD are required” column. The 2nd file needs to be linked to your first and should be entered as subordinate financing (Sub. Financing button)on your URLA. Any other program should be entered on your 1st and on your URLA under “Other New Mortgage Loans”.
- Exception is CalHFA and the 3rd loan, if applies. 1st and 2nd are linked, 3rd is entered as a 2nd, 2nd
Note: Encompass has been set up to auto-populate fees based on loan program chosen.
2nd Liens (Non-DPA)
- Only 2nd liens (Non-DPA) that currently require a 2nd file are SpringEQ. The 2nd file needs to be linked to your first and should be entered as subordinate financing (Sub. Financing button)on your URLA. All other 2nd liens should not have a 2nd file created. These should be entered on your 1st and on your URLA under “Other New Mortgage Loans”.
If you have any questions or need additional clarification, please reach out to the Help at Help@goldstarfinancial.com.