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#1665255 - 02/14/12 09:49 PM Fee not disclosed
mzachau, CRCM Offline
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mzachau, CRCM
Joined: Oct 2006
Posts: 470
San Francisco
When a fee is not disclosed on a revised GFE or the HUD-1 Settlement Statement, can the fee still be collected after the loan has closed?

A 442 inspection fee was not disclosed on either document.

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Lending Compliance
#1665311 - 02/15/12 12:56 AM Re: Fee not disclosed mzachau, CRCM
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,227
Galveston, TX
How do you plan on collecting it?
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#1665313 - 02/15/12 01:13 AM Re: Fee not disclosed mzachau, CRCM
Truffle Royale Offline

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Even if you went back and redid the HUD (which is all you could do because the GFE cannot be changed), you required this fee as part of the loan which puts it in the 10% tolerance so most likely, you'd end up paying 90% of the fee anyway.

If I were the borrower...well, suffice it to say, I wouldn't be paying to fix your mistake.

This is an error that needs noting and training to guard against it happening again.

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#1665601 - 02/15/12 04:57 PM Re: Fee not disclosed mzachau, CRCM
mzachau, CRCM Offline
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mzachau, CRCM
Joined: Oct 2006
Posts: 470
San Francisco
Closing was asking to bill the client. The charge for the 442 would not cause the 10% tolerance to be exceeded. My instruction was for them to eat the cost.

I recall though that under RESPA, if an institution does not properly disclose a fee on the GFE and/or HUD-1, then the borrower cannot be charged for that fee. Is that correct?

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#1665745 - 02/15/12 07:37 PM Re: Fee not disclosed mzachau, CRCM
Dan Persfull Offline
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Dan Persfull
Joined: Aug 2002
Posts: 47,517
Bloomington, IN
If the bank paid the fee you need to issue a revised HUD showing it paid and if the fee was not disclosed on the GFE you will be comparing $0 to $442 in the comparison chart.

Depending on the type of "inspection" fee it could be subject to the 0% tolerance and you would have to cure it by reimbursing the borrower 100% of the fee regardless who paid it.

If it falls within the 10% tolerance category then you just eat the fee since you say it does not put you over the 10% tolerance.
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The opinions expressed are mine and they are not to be taken as legal advice.

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#1665762 - 02/15/12 07:50 PM Re: Fee not disclosed mzachau, CRCM
mzachau, CRCM Offline
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mzachau, CRCM
Joined: Oct 2006
Posts: 470
San Francisco
Thank you Dan

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