1003 URLA Part 3

This feature was introduced with Encompass 19.3. (View the release notes)

This topic describes the process for completing Part 3 of the redesigned Uniform Residential Loan Application (URLA) form that is required for all new loan applications in November 2020. For information about the pre-2020 version of the URLA, refer to 1003 Loan Application - Page 1, 1003 Loan Application - Page 2, 1003 Loan Application - Page 3, or 1003 Loan Application - Page 4.

Section 2: Financial Information - Assets and Liabilities

On the 1003 URLA Part 3, the following different types of assets and liabilities for the borrower, co-borrower, or both are recorded in section 2:

2a. Assets – Bank Accounts, Retirement and Other Accounts
2b. Other Assets
2c. Liabilities - Credit Cards, Other Debts and Leases That You Owe
2d. Other Liabilities and Expenses

Within each section of the input form, buttons enable users to access verification input forms where additional entries for assets and liabilities can be created. These verification records are included when the URLA 2020 output form is generated unless the Does not apply checkbox is selected for a borrower or co-borrower in one or more sections.

The information entered on these forms print in section 2 of the URLA 2020 output form and relevant subtotals will print on the output form and the Underwriter Summary as necessary. VOL entries can still be populated through Credit Report order and Import Liabilities.

On the URLA 2020 input and output forms, mortgage liabilities associated to REO properties through the Verification of Mortgage are now disclosed as part of Section 3: Financial Information – Real Estate.

Section 2a. Assets - Bank Accounts, Retirement, and Other Accounts You May Have

This section identifies all deposit accounts owned by the borrower and co-borrower related to banking and retirement planning that need to be considered in underwriting the loan. Click the Show all VOD button to open the Verification of Deposits input form in a pop-up window to create entries for these types of asset. Records are associated with either a borrower, co-borrower, or both. The first five assets on the Verification of Deposits input form display on section 2a on the 1003 URLA Part 3 input form. The Borrower Total and Co-Borrower Total display on the lower-left. The combined borrower and co-borrower total displays in the Total Asset Amount on the lower-right.

Because the VOD can support up to four lines with the same institution, only the first line from the VOD is shown on URLA Part 2a. However, if additional lines are included in that VOD, they will appear on the printed output form. For records with multiple entries in VOD in the URLA 2009 version that do not have accompanying enumerations on the URLA 2020 version of the Verification of Deposit, these entries will be converted to Verification of Other Asset records, and any line items referring to the old value will be deleted from the VOD.

Section 2b. Other Assets You Have

Section 2b captures other borrower and co-borrower assets that are outside the traditional account deposit structure, allowing the lender to identify the cash or market value of assets or asset accounts beyond the bank and retirement accounts captured in section 2a. Click the Show all Other Assets button to open the Verification of Other Assets input form in a pop-up window to create Other Asset records. The first three entries in the Verification of Other Assets input form display in section 2b. The Borrower Total and Co-Borrower Total display on the lower-left. The combined borrower and co-borrower total displays in the Total Other Asset Amount on the lower-right.

An Earnest Money Cash Deposit in this section will affect the Cash to Close. Earnest money is still reflected in Qualifying the Borrower table on the Lender Page on the URLA 2020 form.

Section 2c Liabilities - Credit Cards, Other Debts and Leases That You Owe

This section maps all the liabilities from the credit report except for mortgages and HELOCs, which are excluded from the calculations populated to the output form for liabilities. Click the Show all VOL button to open the Verification of Liabilities input form in a pop-up window to create liability entries or to view all entered or imported liabilities. Accounts are associated with either a Borrower, CoBorrower, or Both. The first five liabilities entered in the Verification of Liabilities input form display on Section 2c.

Real estate liabilities are included in section 3 of the URLA 2020 output form. Liabilities that are not reflected on the credit report are entered in the Verification of Other Liabilities input form.

Section 2d. Other Liabilities and Expenses

Section 2d capture liabilities from either the credit report or borrower disclosures that are not related to the items covered in section 2c (Credit Cards, Other Debts and Leases) or section 3. Examples include alimony, child support, separate maintenance, and job-related expenses. Click the Show all Other Liabilities button to open the Verification of Other Liabilities input form in a pop-up window to create or edit additional verifications. The first three liabilities and expenses entered in the verification form display on section 2d. The Borrower Total and Co-Borrower Total display on the lower-left of section 2d. The combined borrower and co-borrower total displays in the Total Other Liability Amount on the lower-right.

Section 3: Financial Information – Real Estate

Use Section 3 on the 1003 URLA Part 2 input form to enter information about properties owned by the borrower, co-borrower, or both. This information is populated in section 3 on the URLA 2020 output form. On the 1003 URLA Part 2, select the I do not own any real estate checkbox for the borrower or co-borrower to collapse all of section 3 for the borrower or co-borrower. Select the Does not apply checkbox in the Mortgage Loan on this Property sections when a property is owned free and clear to collapse the Mortgage Loans on this Property section for that particular property on the output form.

To create entries for mortgage properties, click the Show all VOM button to open the Verification of Mortgage input form in a pop-up window. The order in which the properties are listed in section 3 matches the order in which the properties display in the Verification of Mortgage input form. When the Subject Property checkbox is selected for a VOM entry, the subject property moves to the top of the list on the VOM input form and in section 3 of the 1003 URLA Part 3. Changing the order of the properties on one form also changes the order of the properties on the other form.