The Department of Veterans Affairs (“VA”) has just published VA Circular 26-17-11, which provides instructions for how the Closing Disclosure (required under 12 CFR §§ 1026.19[f] & 1026.38) should be properly filled out for VA loans. Noteworthy parts of this Circular include the following:
- The VA will no longer accept separate itemized lists of credits and charges;
- Reductions in fee amounts to make them conform with VA’s allowable fee restrictions must be shown via specific credits and/or principal reductions. Lump-sum credits for such purposes are prohibited; and
- For principal reductions, “the lender must provide verifiable evidence that the principal reduction has occurred and that the Veteran was notified of the principal reduction.”
These instructions will apply to loans with application date of July 2, 2017 or later.
We are currently reviewing this change to determine any impact to our document library and/or systems and evaluating any necessary changes. Any modifications we make will be announced on our website (http://blog.docutechcorp.com/category/document-updates).