Loan officer has a purchase that is being done by two private parties that know each other. He is closing the loan today and received the settlement statements and noticed that the parties worked out some new deals for septic etc. It is creating a $950 tolerance variation. What are our options so that we don't have to eat this?? We were left out of the loop completely.

What does this have to do with settlement charges that are disclosed on the GFE that would be subject to tolerances?

Maybe a little more history would help. Borrower said that he was buying the property as is. They decided (the borrower and the seller) to have a survey, septic and well inspection done and the the buyer was to pay for these things. The processor believes that these charges should go on block 6 of the GFE and therefore out of tolerance. However, when I read the new RESPA rules FAQ we never required the survey, Septic and Well inspections to be done so in my opinion we should not put them in box 6. But I am new at this and not real sure about my opinions so I want a more seasoned one. Does this explanation help at all???

Only items required by lender except for owner's title ins. on purchases have to shown on the GFE and have to stay within the tolerances.

The charges are on the Settlement Statement, where do we show them on the HUD-1?

Everywhere we put them, we get an violation warning. Where do you put charges on the HUD that were not required by the lender?

section 1300. They will not affect you in any manner where tolerance is concerned since you didn't require them...the parties to the transaction just decided they wanted them. Home Owner's Warranty (or maybe it was an inspection) is used as an example of this in the FAQ's if you want to find an example.

I agree with Terps and RRJ. These are not settlement charges required by the lender therefore they are not disclosed on the GFE and they do not affect your tolerances.

Thank you for your responses

Hey..good news for once, huh!

No doubt. The loan officer was just going to suck it up and eat the variance but I just didn't think that was right. So yay for good news on a Friday no less yeeeehaw