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#1333467 - 01/28/10 05:37 PM RESPA - GFE Title Services Shopping List
JobSecurity Online
Gold Star

Registered: 10/16/09
Posts: 333
How are other banks handling letting the borrower shop for title services? Our in-house lenders do not allow them to 'shop'. Our secondary market lenders do. (What does 'shop' really mean anyway?) I am concerned about putting too many companies on the list and trying to keep up with them if their prices change. I don't want the bank to have to pay for that! What if our in-house lenders use a company not on the list? It would be in our best interest to keep the list small. I can't find this addressed anywhere. Please give some advice.

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Lending Compliance
#1333512 - 01/28/10 07:07 PM Re: RESPA - GFE Title Services Shopping List [Re: JobSecurity]
pacar Offline
Gold Star

Registered: 07/24/07
Posts: 314
Deb G,
I have many of the same questions you do and it sounds like we're in the same boat! I'll add one more question:

Is it OK for lenders in the same bank to have different practices on allowing the shopping to occur? If "Bill" lets them shop and "Ted" does not, can we get in trouble? Can we specify the ability to shop based on the type of loan? (e.g. we're keeping this one in house so you can't shop, but we're selling this one so you can shop)

I'll be watching this thread for some guidance from the community...

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#1333517 - 01/28/10 07:30 PM Re: RESPA - GFE Title Services Shopping List [Re: pacar]
jlroberts Online
Diamond Poster

Registered: 09/07/09
Posts: 1352
Loc: Ohio
We are only listing one two title companies on our list. They both charge exactly the same fees. If the borrower chooses one of those two, it is considered lender choosen, however the fees will be accurate. If they do not choose either company, then the fees can change, it is consider borrower choosen and the lender is not subject to the 10% tolerance. We are only listing one surveyor on our list for the same reasons.

Shop = the borrower has the choice to tell the lender who they want to provide the service. If the lender makes all the choices, then you are not allowing them to shop.

In your example of the in-house title, you are not allowing them to shop, therefore your fees should always be accurate. As far as the loans that are not in-house. You will be given them a list of provider(s) that can provide that service. There is no minimum number of providers that you must have on your list but you must have at least one provider on your list.

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#1333518 - 01/28/10 07:36 PM Re: RESPA - GFE Title Services Shopping List [Re: jlroberts]
Truffle Royale Offline

10K Club

Registered: 07/09/03
Posts: 13767
I don't understand how lenders get to make choices like this.

It would seem to me to not only open the door for processing errors because someone forgets forgets who does what when. It leaves the bank open for borrowers wondering how come 'he got to choose and I didn't?' Or worse yet, 'Jim let me choose but Bill won't? What gives?' I'd get a bank wide policy on it and make everyone stick to it.

Beyond that, who's preparing the lists Jim is giving out? Does it have the same companies that Bill is insisting the borrower use?

Too many potential pitfalls here and the examiners haven't even walked in the door to give you their 'opinion'. crazy Not good business practice, imho.

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#1333525 - 01/28/10 08:01 PM Re: RESPA - GFE Title Services Shopping List [Re: Truffle Royale]
jlroberts Online
Diamond Poster

Registered: 09/07/09
Posts: 1352
Loc: Ohio
We do in-house loans loans and secondary market loans. Our LOS has the ability to set up default fees by product. When the lender chooses the product, they don't have to mess with the fees or required services. Everything calculates for them based on whether the loan is a purchase or refinance.
The only service that the borrower can shop for on our in-house loans is the title service. Secondary market loans are a different animal and have different requires. They dictate the type of appraisal you must get or what endorsements you must have on the title policy. The two services they can shop for are the title and the surveyor.
We only have one list and that will be given to every applicant.

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#1333635 - 01/29/10 09:37 AM Re: RESPA - GFE Title Services Shopping List [Re: jlroberts]
pacar Offline
Gold Star

Registered: 07/24/07
Posts: 314
jlroberts: When you say "Title Service" is one of the services your borrower can shop for, whch part of the GFE does this go? Box 4, 5, or 6?

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#1335174 - 02/01/10 03:35 PM Re: RESPA - GFE Title Services Shopping List [Re: pacar]
jlroberts Online
Diamond Poster

Registered: 09/07/09
Posts: 1352
Loc: Ohio
Block 4 and 5. Title services can never go in Block 6. We'll be listing the survey in Block 6.

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#1341252 - 02/10/10 02:06 PM Re: RESPA - GFE Title Services Shopping List [Re: jlroberts]
rsanders Offline
Member

Registered: 02/03/10
Posts: 55
What about if you have branches in different towns? Do you have the same list for all branches or do you taylor it to that branch?

Also are there any specifics on the layout of the list? i.e. title, format, letter head, etc.

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#1341409 - 02/10/10 03:50 PM Re: RESPA - GFE Title Services Shopping List [Re: rsanders]
David Dickinson Offline
10K Club

Registered: 11/28/00
Posts: 13799
Loc: Central City, NE
The list needs to be specific to the customer. Not only tailor it for the branch, but tailor it for the customer.

There is no guidance on the layout.
_________________________
David Dickinson
http://www.bankerscompliance.com

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#1347613 - 02/23/10 01:01 PM Re: RESPA - GFE Title Services Shopping List [Re: jlroberts]
zums Online
Junior Member

Registered: 01/05/10
Posts: 39
Originally Posted By: jlroberts
Block 4 and 5. Title services can never go in Block 6. We'll be listing the survey in Block 6.


If title services are the only service we are allowing the customer to shop for and putting on our list, and they are requried to be listed in block 4.... does this mean that block 6 would remain blank with a $0.00 amount?

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#1347834 - 02/23/10 04:17 PM Re: RESPA - GFE Title Services Shopping List [Re: zums]
zums Online
Junior Member

Registered: 01/05/10
Posts: 39
Originally Posted By: zums
Originally Posted By: jlroberts
Block 4 and 5. Title services can never go in Block 6. We'll be listing the survey in Block 6.


If title services are the only service we are allowing the customer to shop for and putting on our list, and they are requried to be listed in block 4.... does this mean that block 6 would remain blank with a $0.00 amount?



bump.... any thoughts ^^ ? Just wondering if that throws any red flags to have nothing listed in block 6 as it is required to have at least one shoppable service. Thanks in advance.

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#1347873 - 02/23/10 04:39 PM Re: RESPA - GFE Title Services Shopping List [Re: zums]
Dani York, CRCM Online
Power Poster

Registered: 04/13/05
Posts: 3114
Loc: TN
Where does it say that you must have at least one shoppable service?

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#1347897 - 02/23/10 04:50 PM Re: RESPA - GFE Title Services Shopping List [Re: Dani York, CRCM]
Dan Persfull Offline
10K Club

Registered: 08/28/02
Posts: 40014
Loc: Bloomington, IN
zums, we have nothing in block 6 for most of our loans.

Dani, I'm not aware of anything in the new Reg that requires you to allow the consumer to shop for any service. If you don't allow them to shop then all services, with the exception of title services and OTI, would be shown in Block 3.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

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#1347902 - 02/23/10 04:54 PM Re: RESPA - GFE Title Services Shopping List [Re: Dan Persfull]
Dani York, CRCM Online
Power Poster

Registered: 04/13/05
Posts: 3114
Loc: TN
That's what I thought. Thanks Dan!

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#1348108 - 02/24/10 09:17 AM Re: RESPA - GFE Title Services Shopping List [Re: Dani York, CRCM]
zums Online
Junior Member

Registered: 01/05/10
Posts: 39
I believe from some webinar or faq session (dont remember exactly which one) we got the impression we were required to have at least one shoppable service provided to the borrower; however, after some further investigation it looks like we misinterpreted a statement that IF you have a shoppable service, you must provide at least one provider on your list for that service.

This confirms what you suggest so we will adjust our thinking. Thanks for clearing that up!

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