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#1306931 - 12/15/09 11:47 PM Changed Circumstances and GFE
Baker Offline
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Joined: Nov 2005
Posts: 781
Washington State
Can someone please clarify?

It states that interest rate depedent charges (charge or credit / points for interest rate chosen, adjusted origination charge, daily interest charges, etc. can change for change circumstances (i.e. rate locks). It also says "our origination charges" must remain the same.

If the loan origination fee or discount changes wouldn't this impact "our origination charge"?

Considering the following scenario:
We don't charge for appraisals, credit reports, etc. So we show a credit in box 2. The FAQs say when there is both credits and fees (outside those in block 3) you would include fee in block 1 and show credit in block 2. If we do this then wouldn't block 1 change?

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RESPA
#1307269 - 12/16/09 04:16 PM Re: Changed Circumstances and GFE Baker
Mr. E. Offline
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New England
I have the same question as Baker. Any thoughts?

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#1307292 - 12/16/09 04:26 PM Re: Changed Circumstances and GFE Mr. E.
TB 12 Offline
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Foxboro
We are including points in block 1 (which I know is a point of debate) so if a customer locks their rate at a different structure than origianlly disclosed, block one would change. Based on the set of fees we are including in block one, points are the only variable depending on the final pricing they choose. The other fees (u/w, processing,etc) are static-not rate or loan amount dependent.
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#1307344 - 12/16/09 04:55 PM Re: Changed Circumstances and GFE TB 12
Mr. E. Offline
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New England
Sox thanks. After reading that portion of the final rule. I interpreted block 1 has potentially having 2 components. 1. Origination charges and 2. interest rate related charges. Changed circumstances that affect the interest rate can have an effect on Block 1 if you have interest rate dependant charges in there. I think the point is, you can't change any OTHER origination charges in block 1. (Of course I could be totally wrong!)

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#1310593 - 12/21/09 08:23 PM Re: Changed Circumstances and GFE Mr. E.
Baker Offline
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Joined: Nov 2005
Posts: 781
Washington State
There doesn't seem to be any way around changing the origination fee if you provide credits because other loan related fees would be disclosed in the origination charge. I am thinking that we have to change origination fee if the charge for the interest rate changes. Thoughts?

So frustrated!

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#1311791 - 12/22/09 08:43 PM Re: Changed Circumstances and GFE Baker
Iszy_theBug Offline
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I was told in a training that you would net your credits and fees in block 2. From what I understand only block 2 can change until the interest rate is locked.

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#1311831 - 12/22/09 09:05 PM Re: Changed Circumstances and GFE TB 12
Sinatra Fan Offline
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New Jersey
Originally Posted By: Sox in 07
We are including points in block 1 (which I know is a point of debate) so if a customer locks their rate at a different structure than origianlly disclosed, block one would change. Based on the set of fees we are including in block one, points are the only variable depending on the final pricing they choose. The other fees (u/w, processing,etc) are static-not rate or loan amount dependent.


That is the position that we are taking as well.
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#1313010 - 12/23/09 10:30 PM Re: Changed Circumstances and GFE Sinatra Fan
Baker Offline
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Joined: Nov 2005
Posts: 781
Washington State
It seems like depending who you ask you get a different response. HUD's FAQs state that where there is a credit and charge you show the charge in block 1 and the credit in block 2. However, netting it does sound familiar too, maybe it was the same training.

I e-mailed my regulator yesterday and her response was that similar questions had been posed and posted on their question board but that they are waiting for an "untimely" response from HUD. Where that leaves us in the meantime I am not sure.

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