Thread Options
#1546448 - 05/05/11 02:55 PM Am I right? 2nd Opinion...
MB Guy Offline
10K Club
Joined: May 2004
Posts: 10,123
Way, way south.
I found a GFE where they disclosed a charge for Owner's Title Insurance for $50, but at closing the actual Owner's Title Insurance cost was $150, of which the seller paid $100, which was disclosed on the HUD in the seller's column.

The HUD's GFE/HUD comparison chart had $50 for the buyer and $100 for the seller.

My understanding is that we should have disclosed the entire $150 for the Owner's Title Insurance on the GFE and since we didn't, even though the seller paid for it, we would need to reimburse the customer for the $100 since we didn't disclose it properly at the beginning. Is that correct?
_________________________
Giddy up.

Return to Top
RESPA
#1546490 - 05/05/11 03:24 PM Re: Am I right? 2nd Opinion... MB Guy
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 46,416
Bloomington, IN
Quote:
The HUD's GFE/HUD comparison chart had $50 for the buyer and $100 for the seller.


There is no buyer/seller column on the comparison chart, only a GFE and HUD column. The GFE column should have $50 and the HUD column should have $150 and the borrower gets the cure, if out of tolerance, regardless who paid the fee.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

Return to Top
#1546500 - 05/05/11 03:31 PM Re: Am I right? 2nd Opinion... Dan Persfull
MB Guy Offline
10K Club
Joined: May 2004
Posts: 10,123
Way, way south.
Oops, sorry Dan, I meant on the HUD body for the $100 for the seller, not the comparison chart.
_________________________
Giddy up.

Return to Top
#1546509 - 05/05/11 03:37 PM Re: Am I right? 2nd Opinion... MB Guy
#Just Jay Offline
10K Club
#Just Jay
Joined: Oct 2006
Posts: 14,389
Cheeseheadland
IMO, it should show $150 in the buyer's column on page two of the HUD, with a seller credit in the 200s on the front for $100.

Also, who selected the title company: the bank, the borrower, or the seller(grrr..)? This may influence where is lands on page three on the comparison chart: in the 10% column if you choose it or the borrower choose your preferred provider, or the unlimited tolerance chart if they or the seller (grrr...) selected another provider. Either way, you would still list the $150 actual cost to the $50 estimate.
_________________________
I don't repeat gossip, so listen closely...

Return to Top
#1546526 - 05/05/11 03:47 PM Re: Am I right? 2nd Opinion... #Just Jay
MB Guy Offline
10K Club
Joined: May 2004
Posts: 10,123
Way, way south.
Jay, the title company was selected by the bank.
_________________________
Giddy up.

Return to Top
#1546538 - 05/05/11 03:56 PM Re: Am I right? 2nd Opinion... MB Guy
#Just Jay Offline
10K Club
#Just Jay
Joined: Oct 2006
Posts: 14,389
Cheeseheadland
Then it will go in the 10% section of the comparison chart. Hopefully, you have not gone over on your other items, and you have a little extra in that section and will not have to refund the entire $100 to your borrower!!

If you are really lucky and have the full $100 in wiggle room (well, I dunno how lucky that would be as that may be an indication your are over estimating to pad for event such as this, but that is another issue), I would still provide a corrected HUD regardless if a cure is needed or not.
_________________________
I don't repeat gossip, so listen closely...

Return to Top
#1546757 - 05/05/11 06:32 PM Re: Am I right? 2nd Opinion... #Just Jay
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 46,416
Bloomington, IN
Quote:
IMO, it should show $150 in the buyer's column on page two of the HUD, with a seller credit in the 200s on the front for $100.


I agree.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

Return to Top
#1547215 - 05/06/11 01:55 PM Re: Am I right? 2nd Opinion... Dan Persfull
Combustible Offline
Diamond Poster
Joined: Dec 2008
Posts: 1,268
During our exams we've found OTI problems that are way out of the 30 day window. Is it too late to honor the tolerance cure, or should we cure just to be safe? IMO, better to show it has been caught and taken care of rather than not.

Return to Top
#1547251 - 05/06/11 02:11 PM Re: Am I right? 2nd Opinion... Combustible
David Dickinson Offline
10K Club
David Dickinson
Joined: Nov 2000
Posts: 18,762
Central City, NE
I think you should cure - no matter how late.
_________________________
David Dickinson
http://www.bankerscompliance.com

Return to Top
#1547254 - 05/06/11 02:14 PM Re: Am I right? 2nd Opinion... David Dickinson
MB Guy Offline
10K Club
Joined: May 2004
Posts: 10,123
Way, way south.
We are totally curing every violation that I have found when appropriate, and even going back into an area that had fairly lax compliance controls and reviewing every single loan made by that area. Just the right thing to do.
_________________________
Giddy up.

Return to Top
#1547266 - 05/06/11 02:22 PM Re: Am I right? 2nd Opinion... MB Guy
#Just Jay Offline
10K Club
#Just Jay
Joined: Oct 2006
Posts: 14,389
Cheeseheadland
IMO, it makes no difference if you are at day 30 or 31... if there is a cure under the new rules, you are obligated to disclose/reimburse it.
_________________________
I don't repeat gossip, so listen closely...

Return to Top
#1547988 - 05/09/11 01:57 PM Re: Am I right? 2nd Opinion... #Just Jay
Patricia Offline
Gold Star
Joined: Mar 2011
Posts: 327
Kansas
Way beyond the 30 days for disclosing the OTI which was paid by the seller so do we reimburse the full amount of the premium or just the amount that would have been out of tolerance?

Return to Top
#1548033 - 05/09/11 02:29 PM Re: Am I right? 2nd Opinion... Patricia
Patricia Offline
Gold Star
Joined: Mar 2011
Posts: 327
Kansas
bump

Return to Top
#1548053 - 05/09/11 02:43 PM Re: Am I right? 2nd Opinion... Patricia
MB Guy Offline
10K Club
Joined: May 2004
Posts: 10,123
Way, way south.
Same question I am trying to figure out Welsh.
_________________________
Giddy up.

Return to Top
#1548070 - 05/09/11 02:59 PM Re: Am I right? 2nd Opinion... MB Guy
#Just Jay Offline
10K Club
#Just Jay
Joined: Oct 2006
Posts: 14,389
Cheeseheadland
I would only reimburse the amount out of tolerance.
_________________________
I don't repeat gossip, so listen closely...

Return to Top
#1548073 - 05/09/11 03:01 PM Re: Am I right? 2nd Opinion... MB Guy
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 46,416
Bloomington, IN
All cures are subject to the applicable tolerance category of 0% and 10%. OTI falls in the 10% category.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

Return to Top
#1548097 - 05/09/11 03:20 PM Re: Am I right? 2nd Opinion... Dan Persfull
Patricia Offline
Gold Star
Joined: Mar 2011
Posts: 327
Kansas
Okay. Thanks Dan and Just Jay.

Return to Top

Moderator:  QCL