Frequently Asked Questions

New Laws Affecting The Settlement Agent And The Mortgage Broker

How do I disclose my yield spread premium (YSP) from the lender?

You must direct the settlement service provider to disclose the YSP in the 800 series of the lines on the HUD-1 or equivalent settlement statement. The YSP must be listed using the words “yield spread premium” and expressed as a dollar amount.

As a loan originator, may I be paid my portion of the mortgage broker fee directly from the loan closing?

(a) Yes. If authorized in the mortgage broker's demand, the settlement service provider may pay your portion of the mortgage broker fee directly to you; provided however, that the HUD-1 or equivalent settlement statement has the following information:
(i) Your name as it appears on your loan originator license;
(ii) Your loan originator license number; and
(iii) The amount to be paid to you by the settlement service provider.
(b) You must provide a copy of the HUD-1 or equivalent settlement statement to the licensed mortgage broker.

What is the quarterly report requirement?

(1) For purposes of determining compliance with chapter 18.44 RCW and chapter 208-680 WAC, each escrow agent shall file with the director, within thirty days following the end of each fiscal quarter, the following:

(c) A one-page summary of the three-way reconciliation from the last month of the quarter. Reminder: An updated Escrow Quarterly Report will be available on DFI’s website on April 30th to be used for the reporting period of April 1st - June 30th. Please remember to provide supporting documents; the one page reconciliation must balance with the quarterly bank reconciliation.

What are common compliance issues found during examination?

• Failure to file quarterly reports.
• Failure to clear exceptions within the reconciliation period.
• At a time when there is a lot of volatility with respect to lenders, it is vital to insure you are in receipt of good funds prior to making any disbursements.
• When an agent has a system conversion or a trust account adjustment the explanation must be done individually, not aggregate.

What happens if I file an untimely quarterly report?

If you file an untimely quarterly report, the Examination Unit will refer the matter to the Enforcement Unit. If this is a first instance, the Enforcement Unit generally will handle the situation through the complaint process. The Enforcement Unit will request that you file the report immediately. You will have 5 business days to comply with the request. If you do not comply with the request, the Enforcement Unit may pursue formal enforcement action seeking sanctions to include at a minimum a fine of $100 per day for each day the report is late. After the first instance, the Enforcement Unit generally will pursue formal enforcement action seeking sanctions to include at a minimum a fine of $100 per day for each day the report is late.

Failure to file timely also will place your company in the queue to be examined.