Our bank is considering paying for appraisals for non-portfolio consumer mortgage loans. We would pay for the appraisal upfront and then re-imburse the customer after closing.

Does anyone out there offer a similar program? How do you pay back the customer? How you report it on the GFE/HUD?

Thanks!

If you're paying for the appraisal up-front, why would you re-imburse after closing?

Search the RESPA forum for bank credits. You'll see that the consensus is to put this on the GFE just as you always would. Give the borrower a letter saying they'll get a credit for the appraisal at closing. Then put it on the HUD on 804 with an offsetting Lender credit in the 200 section on page 1.

Ditto TR on how to handle it but see below. If you don't want to give a letter, you can just tell them the bank will pay it.

Many banks absorb the credit report fee, for instance, but we still have to disclose it. If you would rather not go through all that crediting and assuming it's a 3rd party appraisal, on the HUD, you can just show it POC-L to the inside, carry it over to page 3, just like a Credit report fee and be done with it (and it's easier to understand by the borrower).

To pay for then reimburse would be paying twice.

Sorry, the customer pays for the appraisal up front and then we re-imburse them after the closing.

I thought this might be more complicated since this is a loan package we were going to sell, we are not funding this loan.

Then simply credit in the 200's at closing.

Does it matter that we will be brokering this loan and not funding it?

no.

Well, it might, if the investor doesn't like how you handled it.