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#1407272 - 06/23/10 06:48 PM GFE - Change Loan Amount
swiggles Offline
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I should know the answer to this but......

If a GFE has been provided, but subsequently, the loan amount increases but no fees are affected, is it necessary to issue a new GFE?
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RESPA
#1407276 - 06/23/10 06:51 PM Re: GFE - Change Loan Amount swiggles
Dan Persfull Offline
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No. The only time you are mandated to issue a revised GFE is when the consumer exercises a rate lock option.
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#1407277 - 06/23/10 06:51 PM Re: GFE - Change Loan Amount swiggles
rockchalk02 Offline
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If you have a "changed circumstance" you may, but are not required to issue a revised GFE that reflects an increase in those fees directly related to the changed circumstance.

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#1407750 - 06/24/10 05:50 PM Re: GFE - Change Loan Amount rockchalk02
West Coast Comp Offline
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Lost in the rain.
Better make sure you don't have any fees that are determined as a % of the loan amount.
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#1407795 - 06/24/10 06:31 PM Re: GFE - Change Loan Amount West Coast Comp
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Thanks....as I stated in my original post, no fees affected.
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#1418614 - 07/22/10 03:48 PM Re: GFE - Change Loan Amount swiggles
Valley Girl Offline
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I also was understood the following section of 3500.7 to mean that you could provide a new GFE but it was not a requirement.

3) Borrower-requested changes. If a
borrower requests changes to the mortgage
loan identified in the GFE that
change the settlement charges or the
terms of the loan, the loan originator
may provide a revised GFE to the borrower.
If a revised GFE is to be provided,
the loan originator must do so
within 3 business days of the borrower’s
request.

However, our state bankers association shared the following response from HUD regarding those times when the loan amount disclosed on the GFE changes and if a revised GFE must be provided.

The loan amount and monthly payment amount would change, and the loan originator is bound by the terms of the GFE at closing – if you did not issue a revised GFE to indicate the changes to the terms due to a change in the loan amount, you would Section 5 of RESPA.

David L. Friend, Esq.
Office of RESPA and Interstate Land Sales
Department of Housing and Urban Development


Any thoughts?

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#1418800 - 07/22/10 06:19 PM Re: GFE - Change Loan Amount Valley Girl
swiggles Offline
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It says that the lender "may"....not "must" provide a new GFE. Isn't the lender bound by the fees disclosed?....not necessarilly the terms?
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#1418833 - 07/22/10 06:52 PM Re: GFE - Change Loan Amount swiggles
David Dickinson Offline
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I agree with Swiggles. I NEVER HAVE TO issue a revised GFE except for rate locks. The GFE is not a contract for terms. Tolerances only consider settlement fees - not loan terms. The loans terms are more of a FYI.

David Friend is making this one up, I believe. I find no where in RESPA where it states this.
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#1418837 - 07/22/10 06:53 PM Re: GFE - Change Loan Amount David Dickinson
swiggles Offline
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Oh.....I'm sooooooo proud!! David agrees with me! Cool!!
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#1418846 - 07/22/10 06:57 PM Re: GFE - Change Loan Amount swiggles
Tesla Offline
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Originally Posted By: swiggles
Oh.....I'm sooooooo proud!! David agrees with me! Cool!!


laugh Makes you feel pretty good when a guru agrees with you, doesn't it?? laugh
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#1418849 - 07/22/10 06:59 PM Re: GFE - Change Loan Amount Tesla
David Dickinson Offline
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When it comes to RESPA/HUD - we're all just guessing! wink
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#1418857 - 07/22/10 07:02 PM Re: GFE - Change Loan Amount David Dickinson
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Originally Posted By: David Dickinson
David Friend is making this one up, I believe. I find no where in RESPA where it states this.
David, I hope you don't end up eating those words. How is this different from what he and HUD have been making up on what to show for balloon note dates and/or whether a fee not charged has to show on p. 3 of the HUD?

To be honest, the part quoted above scares me. Seems we better be disclosing on changed loan amounts too. How much you wanna bet this is in the next Round-up? smirk

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#1418888 - 07/22/10 07:26 PM Re: GFE - Change Loan Amount Truffle Royale
David Dickinson Offline
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The balloon note issue is clearly spelled out in the reg. HUD didn't make anything up there, the FDIC did. The "fee not charged" issue is HUD's interpretation of Appendix A (charge isn't a charge unless there's a fee). I've talked with them in person and on the phone about this one. I disagree with their interpretation and have the regulation to back me up. However, now they issued formal guidance in the RESPA Roundup - which is formal guidance in my opinion.

If it shows up in a formal guidance, I'll submit to it. Until then, I don't/won't.
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#1418913 - 07/22/10 07:47 PM Re: GFE - Change Loan Amount David Dickinson
RR Joker Offline
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In defense of FDIC, however...their interpretation came FROM HUD...so did the FRB's, who were given that same interpretation...I'm just happy it got cleared up "officially" because that was a misleading as it gets, IMHO!
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#1418920 - 07/22/10 07:54 PM Re: GFE - Change Loan Amount RR Joker
David Dickinson Offline
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I am too, but it's odd to me that David Friend and Andrew Fay (from HUD) told me they don't know how the FDIC/FRB got that interpretation.
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#1419067 - 07/23/10 01:29 AM Re: GFE - Change Loan Amount David Dickinson
Truffle Royale Offline

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I have this mental image of David and Andrew and the FDIC and FRB all standing there with their arms crossed over their chests with their first fingers pointing in opposite directions.

Add the bill signed into law yesterday and I'm seriously considering flipping burgers for a career.

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#1419125 - 07/23/10 01:13 PM Re: GFE - Change Loan Amount Truffle Royale
RR Joker Offline
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laugh TR..I put my app in at Wally World to be a greeter..come join me!

Seriously, tho...the new bill is going to be a hassle no doubt and so much to inact in a relatively small amount of time...but alot of it is pretty easy stuff (so far it seems...I hope I didn't just jinx anything eek) and some of it we have been hearing rumblings of for YEARS! (Like combining TIL and RESPA for instance and adding more fees to the High Cost calcs).

Truth be known...with all the major changes over the past couple years that we've had to deal with, I think we can handle whatever they dish out now.

(Hey..might as well be optimistic...right? grin )

Last edited by RR joker; 07/23/10 01:13 PM.
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#1419247 - 07/23/10 03:05 PM Re: GFE - Change Loan Amount RR Joker
swiggles Offline
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Originally Posted By: RR joker
Truth be known...with all the major changes over the past couple years that we've had to deal with, I think we can handle whatever they dish out now.
ABSOLUTELY!!! laugh

And the passage of the bill opened a door for the Compliance Department here at my bank! We're going to get to hire another person! Woot, woot!! grin
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#1419344 - 07/23/10 04:45 PM Re: GFE - Change Loan Amount swiggles
Tesla Offline
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[/quote]And the passage of the bill opened a door for the Compliance Department here at my bank! We're going to get to hire another person! Woot, woot!! grin [/quote]

Can I work from IL??? I need a job! smile
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#1419349 - 07/23/10 04:57 PM Re: GFE - Change Loan Amount Tesla
swiggles Offline
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Originally Posted By: SkiDoo
[/quote]And the passage of the bill opened a door for the Compliance Department here at my bank! We're going to get to hire another person! Woot, woot!! grin


Can I work from IL??? I need a job! smile [/quote]

They won't even let ME work from HOME! So I suspect they will not let you work from IL. The position will probably be starting pay and "clerk" type work. Wait!.....hmmmm.....maybe I will apply for the job....less stress.
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#1419355 - 07/23/10 05:01 PM Re: GFE - Change Loan Amount swiggles
Tesla Offline
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Well, I had to try - been looking since December... cry
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#1419397 - 07/23/10 05:51 PM Re: GFE - Change Loan Amount Tesla
MN Banker Offline
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Ok, so I know that HUD giving different answers to the same questions is par for the course, but I just wanted to share the response I got when I asked if we HAD to re-disclose because the loan amount changed (i.e. "the scenario I described"):

RESPONSE: If the rate has expired you would also have to issue a revised GFE. Also, if there is a changed circumstance where you may issue a revised GFE and the borrower requests a GFE to reflect the changes to the GFE you then must issue a revised GFE. If the borrower does not request a revised GFE then you can issue a revise GFE or you can stand by the original GFE in the scenario you have described.

I have no idea who responded (no name on email) so I'm sure it was someone below David, but since I have this in writing this is what I'm going by for now!

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#1419483 - 07/23/10 07:11 PM Re: GFE - Change Loan Amount MN Banker
David Dickinson Offline
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Quote:
RESPONSE: If the rate has expired you would also have to issue a revised GFE. Also, if there is a changed circumstance where you may issue a revised GFE and the borrower requests a GFE to reflect the changes to the GFE you then must issue a revised GFE. If the borrower does not request a revised GFE then you can issue a revise GFE or you can stand by the original GFE in the scenario you have described.

First sentence - not true. Which they state correctly in the 2nd 1/2 of the last sentence - you can stand by the original GFE.

If the borrower requests a GFE to reflect changes . . you MUST issue a revised GFE???? Where is that in the regulation?

There's no name on the email? Wow! I wouldn't count it anymore than the paper it's written on. You may want to reply back and ask them who issued this and give them my responses. I wouldn't go by it for now at all.
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#1419541 - 07/23/10 07:41 PM Re: GFE - Change Loan Amount David Dickinson
MN Banker Offline
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Oh, I totally agree that the first two sentences are basically made up.

Why wouldn't you go by it since there is no name? They replied to my email so obviously it's from them. I mean, they say we can email them at a particular email address for questions, but because they didn't put a name on it I can't rely on it? Considering answers by David Friend himself aren't always right I'm not going to worry about it. The last two (including that one) that I got back from them did have what appears to be initials in the subject line. Good enough for me - at this point I've lost the will to fight it (and I know that's a crappy attitude, I just can't stand this back and forth from HUD anymore)

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#1419572 - 07/23/10 07:57 PM Re: GFE - Change Loan Amount MN Banker
David Dickinson Offline
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Central City, NE
Just because they said it, it's accurate, true and to be followed? What if someone said something inaccurate? Does that over-ride the regulation?

You are responsible for compliance. I don't think waiving an email - with no name on it - is going to hold any weight with your field examiners.
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