Rhode Island Code of Regulations › Title 230 - Department of Business Regulation › Chapter 40 - Banking › Subchapter 10 - Lending › Part 3 - Home Loan Protection Act › Section 230-RICR-40-10-3.5 - Provisions

Current through June 14, 2024
A. Records/Record-Keeping
1. Each Person subject to the requirements of
				  the Act shall maintain records for each and every loan file supporting and
				  substantiating the tangible net benefit and/or High Cost Home Loan analysis
				  performed during the transaction.
a. Each
				  Person subject to the requirements of the Act must keep a list of all loans in
				  which the "tangible net benefit" has been assented to by the borrower. The
				  Creditor is required to maintain on file and be in possession of documentation
				  clearly identifying and substantiating the "tangible net benefit" that existed
				  at the time the Home Loan was consummated. Failure to clearly identify,
				  document, and substantiate the respective tangible net benefit will be deemed a
				  violation of this Part, of R.I. Gen. Laws §
												34-25.2-5(b), and
				  a basis for administrative action pursuant to R.I. Gen. Laws §
												19-14-13. The analysis performed
				  regarding whether the borrower has a "tangible net benefit" must be accurate
				  and based upon verified information as reflected by the Form 3 HLPA Disclosure
				  entitled "Rhode Island Home Loan Protection Act Disclosure Tangible Net
				  Benefit" as required by this Part.
b. Each Person subject to the requirements of
				  the Act must keep a list of all loans in which the High-Cost Home Loan has been
				  assented to by the borrower. The analysis performed regarding whether or not a
				  loan is a "High-Cost Home Loan" must be accurate and based upon verified
				  information as reflected by the Forms 4 and HLPA 5 Disclosures entitled,
				  respectively, "Rhode Island Home Loan Protection Disclosure High Cost Home
				  Loan" and "Rhode Island Home Loan Protection Disclosure Consumer Caution and
				  Home Ownership Counseling Notice and Certification" as required by this Part.
				  Failure to clearly identify, document, and substantiate the respective
				  High-Cost Home Loan will be deemed a violation of this Part, and a basis for
				  administrative action pursuant to R.I. Gen. Laws §
												19-14-13.
c. The individual authorizing the Home Loan
				  after reviewing said tangible net benefit and/or High Cost Home Loan analysis
				  shall date and sign the written record of analysis by confirming that he/she
				  has reviewed the analysis and confirms whether or not the loan is a High Cost
				  Home Loan under the terms of the Act.
d. All applicants must be provided with
				  Disclosure Forms 1 and 2 within three (3) days of application. Verification of
				  submission to applicant and fully executed copy of Disclosure Forms 1 and 2,
				  provided in a bulletin issued by the Department for that purpose, must be
				  maintained in each loan file.
e.
				  All Applicants who refinance a Previous Loan that was Consummated within the
				  prior sixty (60) months must be provided with Flipping a Home Loan Disclosure
				  Form 3 entitled "Rhode Island Home Loan Protection Act Disclosure-Tangible Net
				  Benefit" prior to or upon Consummation of the Home Loan. Verification of the
				  date of submission to Applicant and a fully executed copy of Disclosure Form 3,
				  provided in a bulletin issued by the Department for that purpose, must be
				  maintained in each loan file.
f.
				  All Applicants who are applying for a High-Cost Home Loan must be provided
				  Disclosure Form 4 entitled "High-Cost Home Loan" and Form 5 entitled "Consumer
				  Caution and Homeowner Ship Counseling Notice and Certification," provided in a
				  bulletin issued by the Department for that purpose, at such time that it is
				  determined by the Creditor that the new loan is a High-Cost Home Loan, but in
				  sufficient time as to enable the Applicant to receive, prior to closing the
				  loan, face-to-face counseling on the advisability of the High-Cost Home Loan
				  transaction, with a third-party non-profit organization Verification of the
				  date of submission to Applicant and a fully executed copy of Disclosure Form 4
				  and Disclosure Form 5 must be maintained in each loan file.
g. All Persons subject to the Act must use
				  the exact disclosure forms, provided in a bulletin issued by the Department for
				  that purpose. The disclosures shall not be altered or changed in any
				  manner.
h. All Persons subject to
				  the Act shall maintain evidence that includes a verifiable invoice or
				  substantially similar document for Bona Fide and Reasonable Fees. Substantially
				  similar documents may include, without limitation, a master service agreement
				  with the service provider that is applicable to all loans. Such documents
				  relating to Bona Fide and Reasonable Fees need not be maintained in each
				  individual loan file.
i. The above
				  records, which may be maintained by optical imaging, electronically or in any
				  manner which will allow retrieval, must be available to the Director of the
				  Department or his or her designee.
j. The above records shall in the case of a
				  Creditor who is a loan broker, be maintained for a minimum of three (3) years
				  from the application date, and in the case of a Creditor who is a lender, a
				  minimum of three (3) years from the date a loan is paid in full or
				  sold.