Some of our closing attorneys charge a fee to review condominium documents. We disclose the fee and do not retain it.

My question is: which GFE Block does this type of fee belong to? I believe it is a Block 3 fee, but I can also see arguments for Blocks 1 and 4. Any help appreciated.

This depends if the "closing attorney" is acting on behalf of the bank or on behalf of the title company.

Bank - Block 1

Title Company - Block 4

My first question is why do you require the review of the condominium documents? If you don't, it cannot be a Block 3 fee. Further, if you're not chosing the attorney, it cannot go in Block 3.

It would seem to me to be a block 4, title cost because it has to do with clear title and closing. But if the borrower choses an attorney not on your servicer list, you won't have to worry about tolerances.

It's definitely not a Block 1 item. That block is for your fees only.

Meant to reply yesterday...thanks to you both.

If the attorney if acting on behalf of the bank in preparing or reviewing loan documents then the fee would be part of the bank's origination charges and would be disclosed in Block 1.

Didn't think of it that way, Dan.
Still don't understand why the condo docs would need to be reviewed tho.

My understanding is that the docs are reviewed to ensure compliance with state law. Further, if we were a larger entity, this review might be done internally. Does that make sense? I'm learning as I go.

All of this now leads me to believe that this fee should be a Block 1, not a Block 4 fee. No?

If you have state specific requirements then I can see the documents being reviewed to assure compliance.

Again whether the fee goes in Block 1 or Block 4 depends on what capacity the attorney is working.

If they are acting as the closing attorney for the bank then the fee goes in Block 1.

If they are acting as the closing attorney for the title company, or they are the title insurance agent, then it goes in Block 4.