Standard and alternate versions of LE and CD within Encompass 360

This blog explores the differences between the standard and alternate versions of LE and CD within Encompass 360.

Standard LE and CD

• The Standard LE and CD (where field ID LE2.X28 is unchecked) were designed by the CFPB for Purchase Transactions allowing lenders to enter payoffs on CD Page 3 in line K04, in addition to charges not yet charged and credits not yet applied to the borrower.
• The field ID LE2.X28 is the following:

• A lender is able to add charges not yet charged to the borrower increasing their final Cash to Close value by entering charges directly on CD page 3 in Section K.
• Due from Borrower at Closing or itemize their additional charges via the Adjustments and Other Credits edit window (field ID CD3.X109) using the UCD tab and entering charges not yet charged to the borrower in Section K. Due from Borrower at Closing.
• A lender is able to add credits not yet applied to the borrower costs decreasing their final Cash to Close value by entering charges directly on CD page 3 in Section L.
• Paid Already by or on Behalf of Borrower at Closing or itemize their additional credits via the Adjustments and Other Credits edit window (field ID CD3.X109) using the UCD tab and entering credits not yet applied to the borrowers costs in Section K. Due from Borrower at Closing.

Alternate LE and CD

• The Alternate LE and CD (where field ID LE2.X28 is checked) were designed by the CFPB for (simple) Refinances where “no” Adjustments or other Credits are able to be made; however, a user still has the ability to made adjustments for non-VOL entries.
• A lender is able to add credits not yet applied to the borrower costs decreasing their final Cash to Close value by entering non-VOL credits in the Payoffs and Payments section of CD page 3.

To add a non-VOL credit:

1. Open the Payoffs and Payments window by pressing the Payoffs & Payments button
2. Press the “Add” button on the top right of the Payoffs and Payments window
3. Select the Adjustment Type from the available options in the drop-down (i.e.: Gift, Grant, Rebate Credit, Other)
4. Enter an Adjustment Description of the Adjustment being made
5. If “Other” from the Adjustment Type drop-down list is selected, enter an Adjustment Other Description and select the “Credit” checkbox, indicating that the entry is a credit to the borrower
6. Enter the Adjustment Amount (only positive values are accepted)
7. Press OK.

Note: Repeat steps 1-7 above for each additional non-VOL credit. Credits will appear as a negative number.

A lender is able to add charges not yet charged to the borrower increasing their final Cash to Close value by entering non-VOL charges in the Payoffs and Payments section of CD page 3.

To add a non-VOL charge:

1. Open the Payoffs and Payments window by pressing the Payoffs & Payments button
2. Press the “Add” button on the top right of the Payoffs and Payments window
3. Select “Other” from the Adjustment Type drop-down list
4. Clear the “Credit” checkbox, indicating that the entry is a charge to the borrower
5. Enter an Adjustment Description of the Adjustment being made
6. Enter an Adjustment Other Description since “Other” was selected as the Adjustment Type
7. Enter the Adjustment Amount (only positive values are accepted)
8. Press OK

Note: Repeat steps 1-8 above for each additional non-VOL charge. Charges will appear as a positive number.

The Include checkbox will automatically check, Description of Purpose will populate with the Adjustment Description as entered in the Add Other Adjustment window, Payoff Amount will be a negative value of the amount as entered in the Add Other Adjustment window and the UCD Type will populate the option selected for the Adjustment Type as entered in the Add Other Adjustment window.

The UCD Type can be changed directly on the Payoffs and Payments window by click once on the UCD type and select options from the drop down rather than double clicking on the non-VOL entry in the Payoffs and Payments and editing in the to edit the Add Other Adjustment window.

• The Include check box is selected by default and indicates that the paid off amount for that borrower pair will be included in the Total Payoffs and Payments (K) field. To exclude the paid off amount for a borrower pair, clear the Include check box.
• When there are non-VOL based entries in the table and a user switch from alternate to standard disclosures, a confirmation message notifies the user that switching to standard disclosures will delete all non-VOL entries from the pop-up window. The user can then click OK to proceed or cancel to continue using alternate disclosures.
• If there are more than 15 entries in the Payoffs and Payments table, including the non-VOL based adjustments, the data prints on the Addendum.
• Adjustment Type, labelled as UCD Type on the Payoffs and Payments window, will display on the Closing Disclosure Page 3 input form as Gift, Grant, Rebate Credit and/or Other as entered in the Add Other Adjustment window. The Adjustment Description will display for each non-VOL entry on the printed Closing Disclosure.
• The “Credit” check box is available only for other adjustment types (charges). Gift, Grant, and Rebate types are all considered credits.

Looking for more information on standard and alternate versions of LE and CD within Encompass 360 or need help with implementing any technology solution within Encompass, leave us a message.

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