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#2052250 - 12/03/15 03:47 PM Employment verification
Dodge Offline
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We have an employer who will not verify employment directly, instead it must be verified through theworknumber. The charge is $25, can we redisclosed the Loan Estimate to show this fee since we did not know this information when the Loan Estimate was issued?

Also, going forward can the Bank disclose a employment verification fee on the Loan Estimate, just in case we have to verify employment through theworknumber, again? If we don't have to verify employment through theworknumber, then no fee will be disclosed on the Closing Disclosure.

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TRID - TILA/RESPA Integrated Disclosures Rule
#2052268 - 12/03/15 04:16 PM Re: Employment verification Dodge
MonicaMc Offline
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Land of Oz
We show an employment verification fee on every file. If it is not needed, it is removed at closing. But we do use it on a regular basis. If we have 2 borrowers that use The Work # for verifications, we will do a re-disclosure to update the fees.

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#2066383 - 02/26/16 08:47 PM Re: Employment verification Dodge
WV Banker Offline
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How are you disclosing this fee on the LE?

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#2066387 - 02/26/16 08:49 PM Re: Employment verification Dodge
rlcarey Online
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rlcarey
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Galveston, TX
It would have to be under services for which the borrower cannot shop.
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#2066485 - 02/29/16 01:47 PM Re: Employment verification Dodge
RR Joker Offline
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The Swamp
We do the same as Monica, only we disclose based on questionable number of applicants. IOW, if we know the employer, we don't show it...if we are not sure, we would charge to cover all potential verifications then adjust at closing based on end result.
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#2066510 - 02/29/16 03:06 PM Re: Employment verification Dodge
Truffle Royale Offline

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We're showing it on all LEs as a separate line item right after the credit report.
There are too many times where we'll do a VOE for the credit decision only to find that in order to do the verification within ten days of closing we have to go through a work number.
If we don't use it, the cost falls off the CD.

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#2070372 - 03/22/16 02:51 PM Re: Employment verification Dodge
MonicaMc Offline
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MonicaMc
Joined: Dec 2013
Posts: 236
Land of Oz
Our third-party QC company is telling us that the Employment Verification fee that we charge on every file (and pay to a third party) should be listed in Section A as an origination charge bc we list it on every file and not just files where we know that fee will come into play. But if we know that the employer does charge the fee, then we can put it in Section B.

Has anyone else heard feedback like this? I disagree, as its clearly a third party service that the lender requires that the borrower cannot shop for, but looking for some guidance.

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#2070734 - 03/24/16 03:35 PM Re: Employment verification Dodge
rlcarey Online
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rlcarey
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Galveston, TX
You never charge the fee and keep it yourselves, right?

Ask them how this fee fits into 1026.37(f)(1):

Origination charges. Under the subheading “Origination Charges,” an itemization of each amount, and a subtotal of all such amounts, that the consumer will pay to each creditor and loan originator for originating and extending the credit.

Time to review your QC vendor?
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#2092335 - 08/09/16 04:11 PM Re: Employment verification rlcarey
Dusty Offline
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Joined: Sep 2006
Posts: 68
New England
According to this you would put the "verification fee" in Section A.

3.Description of charges.
Other than for points charged in connection with the transaction to reduce the interest rate, for which specific language must be used, the creditor may use a general label that uses terminology that, under § 1026.37(f)(5), is consistent with § 1026.17(a)(1), clearly and conspicuously describes the service that is disclosed as an origination charge pursuant to § 1026.37(f)(1). Items that are listed under the subheading “Origination Charges” may include, for example, application fee, origination fee, underwriting fee, processing fee, verification fee, and rate-lock fee.

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#2092603 - 08/10/16 10:17 PM Re: Employment verification Dusty
Docs Offline
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Only fees that are paid to the loan originator and/or the creditor can appear as an "Origination Charge". So if the originator or creditor charges and retains a verification fee it would appear in the "Origination Charge" section. If the verification fee is is paid to a third party it must appear in section B. See 12 CFR 1026.37(f)(1) and related Official Interpretations.
Last edited by Docs; 08/10/16 10:18 PM. Reason: added citation
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#2232449 - 03/05/20 06:26 PM Re: Employment verification Dodge
FSLICBanker Offline
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Joined: Apr 2008
Posts: 90
North Carolina
Following up on an older thread.

Scenario 1 - Bank conducts VOE itself and charges a $25 fee for each verification. Should the fee on the LE and CD both go in Section A since the bank is both requiring the service and retaining the fee?

Scenario 2 - Bank outsources VOE to a third party and 3rd party charges the $25 fee. Should this fee be in Section B on both LE and CD as bank required the fee and selected the non-shoppable provider?

Thanks.

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#2232451 - 03/05/20 06:28 PM Re: Employment verification Dodge
rlcarey Online
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Galveston, TX
Correct on both accounts
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#2232504 - 03/06/20 12:59 PM Re: Employment verification Dodge
FSLICBanker Offline
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Posts: 90
North Carolina
As always, my humblest thanks Mr. Carey.

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