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Understanding Escrow Closing Disclosures: Key Information for Members

This guide outlines the vital aspects of the Escrow Closing Disclosure required by credit unions. Members should receive this notice at least three business days before their escrow account is canceled. Important details include the closure date, reasons for closure, and implications of no escrow account, such as covering all property costs. Exceptions to the notice requirement are covered as well, including reverse mortgage transactions and accounts established due to delinquency. Stay informed with this essential information tailored for members.

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Understanding Escrow Closing Disclosures: Key Information for Members

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  1. CU Compliance Connection CFPB Escrow Disclosures

  2. Escrow Closing Disclosure The Escrow Closing Notice must be provided to a member prior to cancelling their escrow account if an escrow account was established in connection with a closed-end consumer credit transaction secured by a first lien on real property or a dwelling.

  3. Escrow Closing Disclosure The credit union must provide the notice no later than three business days before the consumer’s escrow account is canceled.

  4. Escrow Closing Disclosure • There are three exceptions to the requirement to provide the notice: • Reverse mortgage transactions; • Escrow account was established solely in connection with the consumer’s delinquency or default; and • When the underlying debt obligation is terminated, including by repayment, refinancing, rescission, and foreclosure.

  5. Escrow Closing Disclosure • The notice must include: • Closure date; • That an escrow account can be called an impound or trust account; • Reason for Closure; • That without an escrow account, the member must pay all property costs; • “Cost to you” Table • “In the future” Table

  6. Escrow Closing Disclosure • The credit union may also disclose: • The credit union’s name or logo; • The member’s name, phone number, mailing address and property address; • The issue date of the notice; and • The loan number or the member’s account number.

  7. Escrow Closing Disclosure

  8. Thank you for joining me for this review of the Escrow Closing Disclosure Stay Tuned… Shawn Wolbert, CIA, CUCE Director CU System Relations 101 S. Washington Square, Suite 900 Lansing, MI 48933-1703 (800) 262-6285 Ext. 486 (734) 658-5427 Mobile Follow me on Twitter – Shawn Wolbert @ Go2CUGuru

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