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#2080586 - 05/26/16 02:54 PM differing late fees on LE
ADN Offline
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Joined: Mar 2007
Posts: 221
Depending upon which investor we sell to, our LE does not always reflect the correct late fee charges. Is this an issue? Our closing disclosure is always accurate.

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#2080684 - 05/26/16 05:59 PM Re: differing late fees on LE ADN
John Burnett Offline
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John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
Pardon my ignorance, but what does the investor have to do with the late fee? Isn't it in the loan contract (promissory note)?
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#2080697 - 05/26/16 06:44 PM Re: differing late fees on LE John Burnett
ADN Offline
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Joined: Mar 2007
Posts: 221
If we know we are selling to a certain investor at closing we will disclose their late fee rather than our own since it will be sold within a few days.

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#2080702 - 05/26/16 07:03 PM Re: differing late fees on LE ADN
Docs Offline
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Joined: May 2016
Posts: 241
I assume the note signed at the closing will also contain the investor's L/C provisions, not yours?
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#2080754 - 05/26/16 08:38 PM Re: differing late fees on LE Docs
ADN Offline
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Joined: Mar 2007
Posts: 221
Yes.

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#2080755 - 05/26/16 08:45 PM Re: differing late fees on LE ADN
Dan Persfull Offline
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Dan Persfull
Joined: Aug 2002
Posts: 47,517
Bloomington, IN
I'm like John. What does the investor have to do with setting the late charges? Unless you are a national bank and have opted out under the mortgage parity act (if that even is still in effect) your late charges are governed by state law, not the investor.

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#2080771 - 05/26/16 09:52 PM Re: differing late fees on LE Dan Persfull
ADN Offline
100 Club
Joined: Mar 2007
Posts: 221
So on our in-house loans we charge 5% or $10 which ever is greater. Our secondary market loans that we sell have a fee of 5%. Would we be in violation if our LE does not reflect the $10?

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#2080774 - 05/26/16 10:09 PM Re: differing late fees on LE ADN
swiggles Offline
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swiggles
Joined: Aug 2001
Posts: 7,351
So if the late fee of 5% on a late payment turns out to be less than $10, the investor doesn't intend to collect $10?
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