Okay, rookie question. I'm new to compliance and I'm finding RESPA confusing. (No news there, I suppose - I've read some of the previous threads looking for an answer.)

I understand that when a customer or the bank pays for a service (appraisal, credit rpt., etc.) PRIOR to closing, the item should be listed POC and to the left of the buyer's column.

My question is: AT CLOSING, if buyer is paying the costs out of his own pocket and not financing the fees, would these also be POC?

I guess I'm having difficulty understanding the distinction here. Is POC simply PRIOR TO CLOSING? Or, is POC, OUT-OF-POCKET?

I loving this stuff so far, but it sometimes makes my head spin!!!

Julie, we are all new at following some of these Regs because they are new themselves or changed.

POC is Paid Outside of Closing. If you have a Regs on CD (or the Net), do a search on that term, especially in RESPA.

Key points on POC items are from the the HUD1/1A instructions.

The settlement agent shall complete the HUD-1 to itemize all charges imposed upon the borrower and the seller by the lender and all sales commissions, whether to be paid at settlement or outside of settlement, and any other charges which either the borrower or the seller will pay for at settlement. Charges to be paid outside of settlement, including cases where a non-settlement agent (i.e., attorneys, title companies, escrow agents, real estate agents or brokers) holds the borrower's deposit against the sales price (earnest money) and applies the entire deposit towards the charge for the settlement service it is rendering, shall be included on the HUD-1 but marked "P.O.C." for "paid outside of closing" (settlement) and shall not be included in computing totals. P.O.C. items should not be placed in the borrower or seller columns, but rather on the appropriate line next to the columns. ...

Section L. Settlement Charges. For all items except for those paid to and retained by the lender, the name of the person or firm ultimately receiving the payment should be shown. In the case of "no cost" or "no point" loans, the charge to be paid by the lender to an affiliated or independent service provider should be shown as P.O.C. (paid outside of closing) and should not be used in computing totals. Such charges also include indirect payments or back-funded payments to mortgage brokers that arise from the settlement transaction. When used, "P.O.C." should be placed in the appropriate lines next to the identified item, not in the columns themselves.

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Andy Zavoina
Opinions stated are not necessarily that of my employer.

I like to think of POC as FYI, OK? Just a little compliance humor there. But seriously, Paid Outside of Closing items are simply listed as to tell the customer "For Your Information" we require these items to be paid, but we are not collecting the money from you today.

If the charge is not paid at closing, it is POC (regardless whether the money flows through the bank or not).