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#1910568 - 04/01/14 07:36 PM Re: GFE & Realtor Fees Cheli
rlcarey Online
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It really doesn't matter now and never has, regardless of what someone thought HUD or a regulator said - a fee that is paid by some agreement between the buyer and a realtor is not a fee to be included on a GFE. Heck, it was never required long prior to 2010 so I am not even sure how this issue ever came up.
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#1910573 - 04/01/14 07:43 PM Re: GFE & Realtor Fees Cheli
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I don't either...my response was to my own theory as to how Red may have mistook this situation. Truf's bolding of the FAQ was not the issue and did not solve the problem. Misunderstanding a bank required vs contract required fee was the issue. Just because a contract requires it does not equate to the bank requiring it (by default).

That's all!

ETA: The issue came up via a new poster. She may well be new to compliance. I think it was an honest question.
Last edited by RR Joker; 04/01/14 07:44 PM.
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#2016147 - 05/27/15 01:38 PM Re: GFE & Realtor Fees Cheli
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Is there anything in TRID that changes this or do only bank required services show up on the Loan Estimate?
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#2016489 - 05/28/15 01:18 PM Re: GFE & Realtor Fees Cheli
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bump
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#2016502 - 05/28/15 01:47 PM Re: GFE & Realtor Fees Cheli
Dan Persfull Offline
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From the Commentary:

4. Examples. Examples of other items that are disclosed under § 1026.37(g)(4) if the creditor is aware of those items when it issues the Loan Estimate include commissions of real estate brokers or agents, . . .
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#2016528 - 05/28/15 02:23 PM Re: GFE & Realtor Fees Cheli
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Ugh! What a pain...

If we see a particular inspection that we would NEVER require in a contract that means we would have to track down an estimated cost for this. I'm assuming this falls within the unlimited tolerance bucket and we don't have to include a provider on our written list, correct?

I can hear our LO's and processors groaning more and more about the changes...
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#2016689 - 05/28/15 05:57 PM Re: GFE & Realtor Fees Cheli
John Burnett Offline
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It will go in Section H under .37(g)(4) and, because it's not a service you require, all you have to do is provide a good faith estimate. The increase limit is under .19(e)(iii) -- unlimited.
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#2017202 - 05/30/15 08:34 AM Re: GFE & Realtor Fees Dan Persfull
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Originally Posted By Dan Persfull
From the Commentary:

4. Examples. Examples of other items that are disclosed under § 1026.37(g)(4) if the creditor is aware of those items when it issues the Loan Estimate include commissions of real estate brokers or agents, . . .


yep, i feel validated
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#2017206 - 05/30/15 05:18 PM Re: GFE & Realtor Fees Cheli
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^^only with regard to TRID and the Loan Estimate. It never belonged on the GFE.

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#2019005 - 06/08/15 04:07 PM Re: GFE & Realtor Fees Cheli
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This may be a silly question but just want to make sure...

If we issue a LE for a loan and then after the fact we get a copy of the contract that says the borrower will get a home inspection, do we have to re-issue the LE and add the home inspection fee in Block H? I would think you would but just thought I'd throw it out there.

Also, what if the contract you receive says the buyer has the right to obtain a home inspection but doesn't say for certain that they will. Include the fee on the LE or not?
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#2019016 - 06/08/15 04:27 PM Re: GFE & Realtor Fees Cheli
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A change in a Block H charge is not a trigger for disclosures under 19(e)(3)(iv).

May is not will and you would not be able in good faith to say it is going to happen. If the contract was contingent upon the inspection, then yes.
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#2019021 - 06/08/15 04:39 PM Re: GFE & Realtor Fees Cheli
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Thanks for the response, Randy!

So this "home inspection" fee only has to go on the LE if it is known for a fact prior to issuing the first LE that the service will be performed?

Or...Would you also include it on a rate lock LE (or any other revised LE that was issued after the original LE for a valid changed circumstance)?

Just when you think you have these things figured out there are little things like this that pop up!
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#2019028 - 06/08/15 04:56 PM Re: GFE & Realtor Fees Cheli
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I do not see any mention of updating changes that may have occurred in Block H.

19(e)(3)(iv)(D) Interest rate dependent charges. The points or lender credits change because the interest rate was not locked when the disclosures required under paragraph (e)(1)(i) of this section were provided. No later than three business days after the date the interest rate is locked, the creditor shall provide a revised version of the disclosures required under paragraph (e)(1)(i) of this section to the consumer with the revised interest rate, the points disclosed pursuant to § 1026.37(f)(1), lender credits, and any other interest rate dependent charges and terms.

The commentary goes on to say:

Official Interpretation

19(e)(3)(iv) Revised estimates.

2. Actual increase. The revised disclosures may reflect increased charges only to the extent that the reason for revision, as identified in § 1026.19(e)(3)(iv)(A) through (F), actually increased the particular charge. For example, if a consumer requests a rate lock extension, then the revised disclosures may reflect a new rate lock extension fee, but the fee may be no more than the rate lock extension fee charged by the creditor in its usual course of business, and other charges unrelated to the rate lock extension may not change.
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#2019034 - 06/08/15 05:14 PM Re: GFE & Realtor Fees Cheli
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My understanding matches that of Randy's...in a nutshell...if you have the contract, you disclose optional charges or normal seller charges contracted to borrower to pay.

If you don't have the contract, receipt of it later doesn't warrant a new LE.
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#2026424 - 07/10/15 12:41 PM Re: GFE & Realtor Fees Cheli
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Okay... but question because I'm getting different feedback. We're being told we need to include the realtor commission on the LE - albeit in Section H. Is this correct?

I understand HOA fees, Home Inspection, Home Warranty etc. but realtor commissions? 1026.37(g)(4) commentary item 4.

I understand only if I know at the time I issue the LE but...
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#2026432 - 07/10/15 01:35 PM Re: GFE & Realtor Fees Cheli
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But - what? The commentary clearly says, if you know, disclose them.
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#2026433 - 07/10/15 01:41 PM Re: GFE & Realtor Fees Cheli
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out of the frying pan...
Just to clarify - that's only if the borrower is paying it, right? If a) we have the contract when preparing the LE b) it has the realtor commission(s) listed on it and c) specifies that the SELLER is to pay, then we still do not show them on the LE (just like today's GFE), correct?
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#2026441 - 07/10/15 02:01 PM Re: GFE & Realtor Fees Cheli
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That would be true.

(just like today's GFE) not sure what this means as because with the GFE, it would never appear regardless of who pays.
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#2026442 - 07/10/15 02:02 PM Re: GFE & Realtor Fees Cheli
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out of the frying pan...
That's what I meant - that it would not show up anywhere before closing. Thanks for the confirmation!
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#2026443 - 07/10/15 02:05 PM Re: GFE & Realtor Fees Cheli
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That's correct. The Loan Estimate only reflects costs that the borrower is expected to pay. And the source of your information on the real estate agent fees can be the purchase contract or information from the buyer or seller or elsewhere. The purchase contract is the most reliable source however.

Including the commission on the Loan Estimate is clearly expected if you have knowledge that the borrower is expected to pay it. Remember that one of the goals of the Integrated Disclosures is to include information about more of the costs of a transaction than just the costs of the loan. And all of the discussion pre-2015 in this thread about non-loan costs and the GFE is moot when the TRID rules are involved.

None of this suggests that you must require a copy of the purchase contract as part of the application package. You can require it in a purchase transaction, but not as a condition of providing the Loan Estimate. Once you have the 6 items of information constituting an application, you have to get the Loan Estimate out within 3 business days, whether or not you can get the purchase contract and other information.
Last edited by John Burnett; 07/10/15 02:19 PM.
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