Borrower Information - Vesting

Use the Borrower Information-Vesting form to enter borrower information, define the ownership rights in the property, enter corporation and trust information, if needed, and create the vesting statement that is used in loan documents. You can also use the form to associate signers with borrower pairs, which configures the sequence of signers on the loan documents, and to add seller information if needed.

By default, borrower information is copied from the 1003 form. If you add or edit borrower information on the Borrower Information - Vesting form, the changes are used to build beneficiaries and create the final vesting text, but the changes are not copied back to the 1003 with the exception of Social Security Numbers, which are copied back to the 1003.

There are three types of entities recorded for vesting purposes:

  • Individuals

  • Trusts, including Inter Vivos trusts

  • Corporations

Individuals

Information about individual borrowers is copied from the 1003 Page 1 form to the Vesting Information section. Use the Vesting Information section to edit the borrower information and create the vesting statement for individual borrowers who are not in a corporation or trust.

ClosedEdit vesting information

Non-Borrowing Owners

When adding non-borrowing owners, it is important to always add them as non-borrowing owner contacts via the File Contacts tool . This ensures that the non-borrowing owner has full eFolder and eSigning functionality for the loan. When a non-borrowing owner is added via the Borrower Information - Vesting form, the borrower is not available as a recipient when sending eConsent requests, document requests, eDisclosure packages, files, and Status Online updates. Additionally, non-borrowing owners added via the Borrower Information - Vesting form will not have eSigning points added to eSignable documents.

Trusts

If the borrower is a trust (including an Intervivos Trust), use the Corporation/Trust 1 and Trust 2 sections to enter information for as many as two trusts. After you add information for a trust, use the Vesting Information section to assign borrowers as trustees or settlors of the trust and create the vesting statement. The Final Vesting to Read field is used to populate all Signature lines in the closing docs as well as the Final Vesting to Read on the Mortgage/Deed of Trust/Security Instrument.

When you select the Print Trust Name(s) on LE/CD Addendum check box, the trust name(s) and the borrower names print on the Addendum pages for the Loan Estimate and Closing Disclosure. When the check box is cleared, only the borrower names print on the Addendum pages for the Loan Estimate and Closing Disclosure.

ClosedAdd a trust

ClosedAdd an Inter Vivos trust

Corporations

Corporations are business entities, such as a corporations, LLC (limited liability company) or partnership. Use the Corporation/Trust 1 section to enter information about a corporation. After you add information for a corporation, use the Vesting Information section to assign borrowers as officers of the corporation and create the vesting statement. The corporation name is pulled into the Final Vesting to Read field when you build the final vesting. The corporation name and the names/titles of corporation officers are pulled into the signature block on the closing docs.

ClosedAdd a corporation

Vesting Types

The table below provides a description of each vesting type, and indicates whether the vesting type is obligated to pay back the loan and is on the title (has rights to the property).

 
Type Obligated On Title Description
Individual X X Most common vesting type. Responsible for paying the loan. Full rights to the property. Signs all documents in the closing package.
Co-signer X   Responsible for paying loan if the individual defaults, but no rights to the property. Signs documents related to loan portion such as the note, but not documents related to the property such as the security instrument (mortgage/deed).
Title only   X Not on the loan, but has rights to the property. Signs documents related to the property such as the security instrument, but not documents related to the loan such as the note. (Most common is Husband and Wife, but could be a parent and child.)
Non Title Spouse     Not on the loan, no ownership rights to the property, but a security interest in contents inside the property. Signs documents to waive marital rights (also known as homestead or dower) indicating no claim to the property itself.
Trustee X X Legal rights to the property. Manages it on behalf of the Settlor for the beneficiaries. Signs all documents in the package, some as individual, some as trustee.
Title Only Trustee   X A trustee, but not on the loan. Signs documents related to the property such as the security instrument. Documents related to the loan such as the note are signed as trustee only and not as individuals.
Settlor Trustee X X Both the settlor and the trustee for a self-declared trust. Signs all documents in the package, some documents as an individual, some as the trustee.
Settlor X   Owns the property and transfers the rights to the property to a Trust. Signs a limited number of documents as settlor.
Title Only Settlor Trustee   X A settlor trustee, but not on the loan. Signs documents related to the property such as the security instrument. Documents related to the loan such as the note are signed as trustee only and not as individuals.
Officer X X Signs on behalf of the corporation or business entity that is on the title. All documents have the corporation name in the borrower field and the corporation name and officer name/title in the signature block.

Sellers

Use the Seller section to enter information for as many as four sellers if needed. Completing this section is optional.

ClosedEnter seller information

See Also:

The Closing Process

  Published  May 27, 2020

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