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Announcement 19-0008: Non-Owner-Occupied Prepayment Penalty Requirements – Additional States Illinois and Virginia

January 24, 2019

Overview

As reminder, Carrington Mortgage Services, LLC (CMS) permits prepayment penalties on Investor Advantage, Carrington Flexible Advantagesm and Carrington Flexible Advantage Plus non-owner-occupied, investment property loan transactions when permissible by State law. Effective Thursday January 24, 2019, CMS will add Illinois and Virginia as permissible states to charge prepayment penalties.

Pricing Prepayment Penalty Options

The prepayment term may be three years, two years, one year or no prepay.

The Base Price is improved to reflect the three-year Prepayment Penalty.

Borrowers can opt for a two-year, one-year, or Buy Out the Prepayment Penalty by adjusting the price as shown on the Rate Sheet.

State Restrictions

CMS prohibits Prepayment Penalties in Alaska, Delaware, North Carolina, New Jersey, Vermont, West Virginia and Wisconsin.

Disclosure Requirements

Correspondent is responsible for the following disclosure requirements for loans with a prepayment penalty:

  • A Business Purpose Affidavit must be executed at Closing.
  • Prepayment Penalty Disclosures required by Federal and State Guidelines

Contacts

Please contact CorrespondentRM@carringtonms.com with any questions.

Carrington thanks you for your business.

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Equal Housing Opportunity An Equal Housing Opportunity Lender. Copyright 2007 - 2024 . Carrington Mortgage Services, LLC headquartered at 1600 South Douglass Road, Suites 110 & 200-A, Anaheim, CA 92806. NMLS ID # 2600. Toll Free # 800-561-4567. All rights reserved. Restrictions may apply. All loans are subject to credit, underwriting and property approval guidelines. Nationwide Mortgage Licensing System (NMLS) Consumer Access Web Site: www.nmlsconsumeraccess.com.

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