We had a mortgage application for a customer in a county that we do not normally do business in. We issued our normal Loan Estimate with an appraisal fee of $450.00. However, when the appraisal management company received the appraisal request, they came back (after LE was issued) and said the cost of the appraisal would be $750.00. Our mortgage department reissued a Loan Estimate with the increase in the appraisal cost within 3 days of finding out the increased price. The reason for the revised LE was "at the time the Loan Estimate was prepared, we were not aware the cost of the appraisal would be $750 in that county." I am questioning whether this is a legitimate changed circumstance. What is your interpretation? Thank you!

I share your skepticism. You can't fire off a loan estimate that includes an appraisal fee on property in a region you aren't familiar with without doing due diligence on the cost of the appraisal first. Without making that effort BEFORE issuing the LE, you can't claim that the original estimate was made in good faith. Based solely on what you've described, I'd argue that you're stuck with the $450 figure and will have to eat the difference.

Thanks, John!

Be sure you verify why the cost of the appraisal was nearly twice as much. Is that a standard amount for that area or was there something about this particular property that upped the fee. If it was the latter and it wasn't known at the time you issued the original LE, than that might very well be a valid CC.

Agreed, TR. But, as they say, that "assumes facts not in evidence" in the original post.

@ John.
Sometimes you have to pull out the real reason and not just take the Cliff Notes version someone writes on a CC form because they think it has to fit the box of 'information not known at time of original LE'.

Agreed. And before dropping the hammer on this matter, "Couples" should get all the facts together to decide what happened. But given what I have seen here in these discussion forums concerning "standard estimates" and "counties (or states) we don't do much business in," I'd bet dollars to Krispy Kremes that no one bothered to get a price quote on the appraisal before sending out the LE.

You've been here in this forum since it started shortly after the TRID rules saw the light of day. Remember the early discussions about having standard Service Provider Lists instead of transaction-specific lists? About how often someone needs to update the costs they use for LEs? Not doing it often enough, or at least when looking at a loan in "foreign" territory, can lead to expensive mistakes.

John and Truffle,

I calls it as it is and all the facts are in my initial post!!!! There was no reaching out to determine if the fee would be higher. They issued the LE based on standard fees and, since this county is relatively close in proximity, never thought the appraisal price would be higher.

So, I still believe this is not a changed circumstance.

Without going too far back and only looking at a literal reading of the OP...I agree, you have zero cause for a CC.

FWIW, we get a quote on every outside appraisal, even in our 'usual' market.

Thanks, Couples, for the clarification. I agree with you, then. No CC, and absorb the difference. Then train to a different result should another "mongrel" loan application come in.