WASHINGTON -- Credit unions must provide prospective lenders with a mortgage summary within three business days of receiving a loan application, according to a new law that took effect last week.
The summary has to include fees, discount points, interest rate, broker's yield spread premium, prepayment penalties and whether property taxes and insurance are escrowed.
The measure also contains rules for implementing disclosure requirements on nontraditional mortgage products and the federal statement on subprime lending. It also bans negative amortization on nontraditional or subprime residential mortgages, and it bans prepayment penalties extending beyond 60 days before the initial reset of an adjustable-rate mortgage.
The law also includes criminal penalties for mortgage fraud.
The Washington State Department of Financial Institutions is seeking oral and written input on rules pertaining to the mortgage disclosure summary form and the statement on subprime lending.
For additional information go to: http://www.dfi.wa.gov/resources
Gateway Services Sells Direct Mail Business
CARMEL, Ind. -- Gateway Services Group LLC, an insurance, investment and trust management CUSO, has sold its block of direct mail business to Allied Solutions LLC.
The block is composed primarily of accidental death and dismemberment insurance administered by Affinion Group and produced at 40 credit unions. The purchase was effective April 1. Allied Solutions, a distributor of products and services to credit unions and other financial institutions, will service the accounts and support new credit union direct mail business through a marketing arrangement with GSG.
"Gateway Services Group selected Allied Solutions because of its strong reputation in the industry and its relationship with Affinion Group," said Scott Jentz, president and founder of Gateway. "We feel this partnership will allow [the CUSO] to continue to support our credit union clients going forward."
Allied Solutions has distributed products and services from providers to financial institutions for more than 27 years and currently has 3,600 clients. The company is a wholly-owned subsidiary of Securian Financial Group Inc.
GSG provides insurance, investments, and trust products and services for more than 100 credit unions. It is also an independent agency and distributes products from many providers, including credit insurance and debt protection for Securian Financial Group.
"This opportunity fits our business model perfectly," said Chris Hilger, president, Allied Solutions. "Affinion Group already is an important business partner; our national network of field associates is positioned to provide great support to the credit union clients, and gives us more opportunities to work with Gateway Services Group."
Hilger said an internal task force is following an implementation plan aimed at integrating the new business into Allied Solutions' operations.
This is the second deal in as many weeks for Allied Solutions. The company recently bought MJB Insurance Services Inc., a provider of financial products and services and insurance to credit unions in Kansas, Missouri and Nebraska.