Here's the problem with the whole "Credit Report Fee" debacle - some institutions order a separate type of credit report such as a "tri-merge" or similar type of product which comes with standard cost - typically $20 to $35 for an individual report, pricing may be different for a joint credit report.

In that instance, it is pretty easy to diclose the fee whether you are charging the borrower or simply eating it.

The PROBLEM is for those institutions that use a typical Experian, Equifax or Transunion report that would also order for an auto loan request, credit card request, or for a guarantor on a business loan. This is most common in smaller institutions that have only one account set up with the credit bureau, and the fee is based on tiered volume - for example $3.00 per report for the first 100, $2.75 for the next 500, and so on, and I've seen the pricing for monthly tiers and quarterly tiers.

In those situations the lender typically does not charge the borrower specifically for the credit report fee, and indeed may not even KNOW what the specific fee for that request is until 90 days after the report has been ordered.

So to start including these on the GFE and HUD just gets messy and frankly wanders into the territory of "I really don't care about this piddly fee, but please tell me more about my options on loan points" for the borrower. It becomes obsessive/compulsive compliance that would make Monk proud.

We are doing a in house renewal and extension of a 5Y balloon and the seller must pay interest at closing. Do we need to reflect this interest payment on our GFE?

So on a GFE for a condo purchase, where the association pays the hazard insurance out of the HOA dues, what do we put in block 11?

RESPA covered construction loan. $ 175,000.00, 1yr.
advancing@ 6.35% fixed, interest due at maturity

what should we put in "summary of your loan" for the
monthly payment?

This question has been asked a couple of times in different threads, and I don't think anyone knows the answer. We have decided to disclose a payment equal to the monthly interest owed for the full loan amount [(loan amount times interest rate) divided by 12].

Yes, you can.

Stupid question warning - If we are doing a single pay loan with monthly interest payments, is this considered a balloon payment for the loan summary section of the GFE?

I wouldn't put anything there except when the borrower needs to obtain seperate H06 coverage which in some cases escrowing is required. In our shop, if the loan went through DU and the master policy does not include HO6 coverage, the borrower must obtain it and we escrow. If it is LP, we don't (for now anyway)

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If I may add that it can provided the 7 day wait under REG Z is met.

And why is it this way?? We have had to get with other local vendors and basically tell them they need to set their pricing list & stick to it due to disclosure requirements of RESPA. I see many threads from people struggling with how to disclose this little charge because no one ever knows what it's going to be. Why hasn't a trade association or someone tried to get these large, national vendors to figure out their pricing structure so banks can properly disclose?

sure you can, as long as you have met the seven day requirement for Reg Z.

We are using a blended average charge.

yes

New question: On a purchase transaction when the borrower has already selected the title company as shown on the purchase contract which is signed prior to the bank receiving (sometimes the contract has been signed 30 days in advance)the loan application, must we still provide a written list of providers? I know there has been some discussion on this subject however, it doesn't make sense that we would provide a list when the borrower chose the title company before we even received the application.

I agree with Dan that ALL fees must be disclosed on the GFE - no matter who pays for it. This is consistent with the regulation and FAQs.

What we are seeing is inconsistent answers from HUD through emails. Unless it comes from the regulation or is in the FAQs, I advise not relying on it. Several pages back I posted an email I got from HUD about not having to list transfer taxes. Then I got a call from David Friend - a HUD attorney. He indicated he read this post and the answer I got (in an email from HUD) was wrong.

HUD: Are you reading this? You've got to update your FAQs with the issues were posting here!

We have a complete application and mailed the GFE, Intent to Proceed, etc to the borrower last week. This week the borrower brought in the signed "Intent to Proceed" and we requested the check for the appraisal. The borrower decides to lock the rate. Now a new GFE is being prepared for the rate lock under a changed circumstance. Do we have to wait for the second "Intent to Proceed" or is the first one sufficient?

Someone posted (in this very long and convoluted string) that they talked to HUD and learned that you don't have to get an "intent to proceed" when you reissue a GFE. That doesn't make sense to me but there's no official guidance. I would think you would need this every time. For instance, I issue a GFE with closing costs of $1000. The applicant lets me know they want to proceed. Then there is a changed circumstance. I reissue a GFE with costs of $2,000 now. I don't have to make sure they want to go on?

I would give some type of confirmation every time.

David, in your opinion, would it be acceptable to collect the appraisal fee after you have received the first intent to proceed, or should you not collect any fee, other than the credit report, until after you receive the subsequent intent to proceed?

After you receive the first intent to proceed you should collect all of your "normal" fees. If you have a change that requires another fee, I believe you should issue the GFE, get their intent and then collect the additional fee.

I sent the following to David Friend at HUD:
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I can’t imagine how busy you are with the RESPA changes that went into effect in January, but I wanted to bring your attention to the mass confusion at Bankers Online. When you called me a few weeks ago, you indicated you had read a post I made (quoting an email I got from HUD about transfer taxes that was incorrect). Have you been reading the posts lately? Please review this thread that over 1700 posts to it. http://www.bankersonline.com/forum/ubbthreads.php?ubb=showflat&Number=1324593&#Post1324593
If you start at the back and move up, you’ll see numerous posts with inconsistent answers from HUD.

For instance:
I've received some responses to questions I've asked HUD...I thought the replies might be helpful.

1. If the lender does not charge the customer for a credit report does it still have to be disclosed on the GFE and on the HUD as POC Lender?
HUD Rep's answer-If the charge for the credit report is not charged to the borrower it does not have to be disclosed.

2. If an attorney prepares documents such as Mortgage, Exhibit, Notice of Seizure, Cash Sale, where should the fee be disclosed?
HUD Rep's answer was it should be disclosed in Block 4.

3. When and where to disclose property tax on the GFE and HUD 1/1A.
HUD Rep's reply was that the only time property taxes are disclosed on the GFE is those held in escrow, page 2, Block 9. There are two occasions you will have the borrower paying taxes that do not appear on the GFE:
1. Tax payments due at the time of closing.
2. Adjustments between buyer and seller.
In both cases, these must be put either on the HUD1 or HUD1A. You would show the tax adjustment on 107/407 or 211/511 (which ever applies). Tax payments to be dispursed, as in a refinance, should be disclosed in between lines 1302-1305, Additional Settlement Charges, and clearly identified.

Just thought I'd share this...hope it is helpful.

The first two are NOT consistent with the regulation or FAQs.

HUD updated the FAQs on 11/19/09. The December FAQ update changed 1 answer and stated the booklets are now available. Is there any hope for more frequent updates with more information? There are lots of questions that are not answered. I’m advising our clients with the following: “Unless it comes from the regulation or is in the FAQs, I advise not relying on it.”

Thank you for any insight you have on this confusion.
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If I get a response, I'll post it.

Thank you, David. I thought I had this down until a fellow BOLer posted GFE-Seller paid items uses 'typically' too. What definition of 'typically' are the examiners going to use?

I'll be checking back often for Mr. Friend's response.

Does a F/I have to issue a Borrowers Achknowledgement (Intent to Proceed)?

I have a question on where interest reserves for construction loans would go on the new GFE? I'm thinking it will go in block 9??

No. The borrower has to 'express intent' but no directive is given as to how.

Where would credit life insurance go on the new HUD?