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#1333511 - 01/29/10 12:03 AM Recommended Service Provider List
pacar Offline
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Joined: Jul 2007
Posts: 320
Im sorry if this has been addressed someplace Im sure it has. (I am getting too many misses on my keyword search of the forum)

My understanding of the Provider List is that it must be specific to the transaction, which means it can be a document that changes from loan to loan.

I realize that we have to keep up to date on prices for all of the providers we have on the lists, but is there anything that would prohibit us from having a list for each lender which outlines the companies they personally like to do business with? (I know this would be an administrative nightmarebut is there any other reason not to do it?)

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Lending Compliance
#1333520 - 01/29/10 12:41 AM Re: Recommended Service Provider List pacar
jlroberts Offline
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jlroberts
Joined: Sep 2009
Posts: 1,563
Ohio
IMO, you make the list so you get to choose if you want one list or ten. But like you said, you would have to keep updating them. frown
We have decided to go with one list. The GFE will state the service. We have labeled the list, Block 4 listing our title companies and Block 6 listing our surveyor. We do not think that it would be a violation to have a surveyor on the list even though Block 6 would be blank on a certain loan product.

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#1333523 - 01/29/10 12:56 AM Re: Recommended Service Provider List pacar
Truffle Royale Offline

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Joined: Jul 2003
Posts: 17,285
Originally Posted By: pacar

I realize that we have to keep up to date on prices for all of the providers we have on the lists, but is there anything that would prohibit us from having a list for each lender which outlines the companies they personally like to do business with? (I know this would be an administrative nightmarebut is there any other reason not to do it?)
imho, yes there are a couple of reasons not to do it. First, how are you going to explain why to the business not on a list given to Borrower A by LO Bill when he's on the one given to Borrower B by LO Joe? Talk about a pc nightmare.

Second,if/when it comes out, and it always does, how are you going to explain to the borrower that if Joe hadn't been busy when he applied, his title company fee would be lower than the one Bill gave him.

Third, and most importantly, the Provider List isn't a requirement to give the LOs warm fuzzies 'cause they get to work with someone they like. It's required to give the borrower the information they need to shop for the best deal for their loan. The RESPA changes were made for the benefit of the borrower. I think that's going to be the mantra examiners walk in the door chanting and I personally wouldn't want to be the one stuck explaining Bill and Joe's preferences to them.

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#1333575 - 01/29/10 01:49 PM Re: Recommended Service Provider List Truffle Royale
Dan Persfull Offline
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Dan Persfull
Joined: Aug 2002
Posts: 46,418
Bloomington, IN
The list of providers is to be established and controlled by the lender, not the loan officer, the lender, not the loan officer is the ultimate entity responsible for compliance.

IOWs the dog controls the tail, the tail does not control the dog otherwise you are in a constant spin.


Quote:
a list for each lender which outlines the companies they personally like to do business with


This reeks of possible underlying Section 8 violations.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

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#1333805 - 01/29/10 04:12 PM Re: Recommended Service Provider List Dan Persfull
pacar Offline
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Joined: Jul 2007
Posts: 320
All very good points (and I had not even thought about section 8!). More fuel for my fire to not allow this ... Thanks!

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