We have an affiliate title company. Under the new HOEPA rules, we have to include the third party charges in the points and fees calculation.

Since we retain a portion of the title charges, do we have to include the total title charges (including the insurance premium payable to say First American) or just the portion we retain?

Total title charges, including those paid to your affiliate and those you retain.

Just to clarify, here is an example:

Bank Affiliate Title Company fees:
$200 settlement/closing fee
$300 Agent's portion of title insurance premium

Underwriter Title Insurance Fund (First American, Attorney's Title, etc.) fees:
$75 Abstract/Title Search
$200 Underwriter's portion of title insurance premium

In this example, we would now have to include the total of $775 which is the total of the bank's affiliated title company fees plus the underwriter's fees?

I appreciate the clarification. Just making sure I get it right!

Not only will you have to include the affiliate title related charges (like the ones you stated) under HOEPA you would also have to include them in any QM points and fees status assessment.

Again, I'm still not sure about the amount we have to include? In the example provided, would the total of $775 be used or just $500? $500 would be the portion the bank retains because of the affiliate status. Thank you.

The whole enchilada. $775

When we say affiliate are we talking about a 25% or more ownership? I just want to clarify. Thanks,

(5) Affiliate means any company that controls, is controlled by, or is under common control with another company, as set forth in the Bank Holding Company Act of 1956 (12 U.S.C. 1841 et seq.).

http://www.gpo.gov/fdsys/pkg/USCODE-2011-title12/html/USCODE-2011-title12-chap17-sec1841.htm