Hypothetically speaking, Would it be permissible for a bank to raise its origination fee, say $250 to help defray the cost of the anticipated expenses from fees that will be over the GFE tolerance range that they will soon have to absorb?

Had a question from the Processing area and I am not sure of the answer.

Where does the Delivery Charge for a Fannie Mae loan go on the new GFE?

DD I am not sure why not. I think it is permissible. I would also say the delivery charge would probably go under costs charged by you. One of the Q&As talks about this. I believe it is question 12 page 6. This is eally a document delivery fee.

I agree. I was simply ranting that it would have been nice to know this BEFORE we all began training and preparing.

Am I correct in saying that the list of providers (from which the customer can shop)does NOT have to include any price information?

If that is the case, the customer theoretically could not make their decision without going home and "shopping".

So in the meantime, what amount do you disclose for that particular service? I'm hearing people say to disclose with the highest amount on your list of providers, but that potentially puts you at a competitive disadvantage.

Does anyone have another interpretation or solution?

I'm mainly worried about the list of attorneys. Can anyone else share how they plan to handle the process of estimating attorney fees?

Thank you.

Correct. There is no guidance about what needs to be included on the list. I would think you would at least provide the contact info. You can certainly add pricing info.

The GFE must have a fee for the service. You have tolerances to live by, so you're really forced to pick the highest fee possible for each service.

I sent an e-mail to Ron Alba, one of the authors of the ABA letter in regards to where the credit life should be listed. He stated that since credit life is an optional item, it would go in 904/905 section on the Hud-1. However, he said he addressed the question to several of the RESPA attorneys and they are quite stumped on the GFE answer. The lists on the GFE are for required items, not optional items.

I attended another training session yesterday on RESPA and now even more confused. Am I correct that a new GFE cannot be issued if we know a fee has changed in the process and that we must wait until closing and see if 10% tolerance and if so, reimburse the fee. What happens if you underestimate.

Our mortgage department manager is telling me that a credit report fee can vary anywhere from $12 to $200 based on the number of investors the loan is shopped to and the number of credit report updates they have to obtain. How in the heck can we disclose that on the new GFE?

I've never seen a CR costing more then $50. Are you sure?

There are many "changed circumstances" that will allow you to re-issue a GFE. If you get to closing and are outside of tolerance, you need to cure the violation by "eating" the difference between the overage and the tolerance limit. You must also issue a new Settlement Statement showing the correction.

We will be discussing this (and more) in our upcoming webinar where we discuss how to complete the GFE & SS line by line. You can find more info here:
http://calendar.bollearningconnect.com/main.php?view=event&eventid=1253206816535

I agree this is a "stumper", but believe credit life insurance would go in block 6 of the GFE. I know this states "required services . . ." but it's the only "logical" place.

I guess I'm having a difficult time understanding why single premium optional credit insurance would have to be disclosed as a "settlement cost" on the GFE. It's money being borrowed to purchase a optional product (thus reflecting in the initial loan amount), not to pay for a settlement item such as required homeowners insurance, pay taxes current, pay for the appraisal, tile insurance, etc.

Have I missed something in the new instructions?

I agree it is to be disclosed on the Settlement Statement, but even then I think it's more appropriate to disclose it in the 800 series (its a fee being paid to the bank where they don't retain all of it) vs the 900 series, but Appendix A does instruct you to disclose in the 900 series; I guess because it is a single premium and is requirend to be paid in advance.

Providing lists of providers. I have a question. I know it's been discussed in this thread having to give a list of insurance companies, HOWEVER, since that is an item all by itself on the GFE, I am questioning that logic ( would question the logic of this anyway! ). Has this thought process changed? Sorry, I've been on vacation and thought I may have missed something even in my scanning back through!

I've been thinking about optional credit insurance and the GFE. I believe it goes on line 904 (if it's optional) of the HUD-1/1A. If you require it, it appears to go in the 1300 series (included in 1301 and itemized outside the borrower's column).

I now believe that it would not be listed on the GFE if it is not required by the lender. Appendix C of RESPA states to list items required in connection with the loan. Optional insurance doesn't meet this criteria.

As I think about this, many other fees come to mind that are not required for the loan (homeowners association dues, for instance). Read Q&A #9 in the HUD-1 General Section about surveys. There's 4 different answers depending on whether it is required and by whom. Specifically, look at Answer d.

David, because Home Owners Association dues include the insurance premium for the blanket policy, I'd argue that they ARE required to make the loan. Just sayin'...not a good example of fees not required for the loan.

Dang. Just when I thought I had it figured out. Dave, I think I agree with you on this. IMO this would qualify as something the borrower could shop for on their own (even though they don't) and would be subject to an unlimited tolerence.

However if the bank required it, I believe this would go 900 series, but I have a different reason. I believe it goes there because it is not optional. This would follow the same logic as a VA funding fee.

You only need to provide a list of providers for GFE items 4-6. See the Q&As #4 in the "GFE-Written List of Providers" section.

okay, I was just remembering a lengthly discussion on this before I left and didn't see where it got "straighted out"..thanks, David!

We pass on the third party overnight delivery charges to the seller or buyer for sending payoffs overnight to reduce the interest they have to pay.

We do not require the overnight fee for our own administrative purposes, such as delivery of documents between offices. Where do we put this fee? Is it part of the title charge or our origination charge?

I am not sure I am reading your question or fee correctly. If you charging a fee "courier fee" for sending payoffs (settlement) then I would call this an title fee.

I have never heard of this, and I could be wrong but it seems like the logical place to me.

See question 4 page 22 of the Q&A. It says that a title service is a service for conducting settlement.

My edit here: What on Earth this fee has anything to do with Title fees I don't know.

Also, look at Q&A #1 in the "HUD-1 - 1300 Series" section. It states the 1300 series is used to record charges "not disclosed on the GFE".

I fear in HUD's effort to prove they are protecting the consumer, they are adament about getting something out, even if it is flawed.

This is a train wreck waiting to happen. All aboard!

Your right I apologize. I think I was getting the two switched around.

So on the 900 series when requied on the 1300 when not required.

Dave can you help me understand this. I just went back and read the last two posts and your post states:

believe it goes on line 904 (if it's optional) of the HUD-1/1A. If you require it, it appears to go in the 1300 series (included in 1301 and itemized outside the borrower's column)



The way I read it, I would put it the other way around. I think I might be missing something.