We have a loan where we are requiring the roof to be repaired. The seller will not be footing the bill on this repair. The borrower is now responsible for the repair and we have now required a holdback amount for the completion of this repair. When we are listing this on the Loan Estimate, where exactly would we put this? When we list in the Adjustments/Other Credits section, it shows as a credit and reduces the cash to close for the borrower. We use Encompass and cannot "force" it to show as a positive number. Anyone have any suggestions on how to disclose? Thanks in advance!

I attended a TRID seminar hosted by the PA Bankers Assoc and we were told escrow holdbacks belong in section H.

I don't see this as much different than what the CFPB discussed in the construction loan webinar:

Further, as is often the case, undefined terms may be used in different ways by different persons. To avoid any misunderstanding that may be based on the meaning of construction holdback, I won't use that terminology. Instead, I'll discuss disclosure of a portion of loan proceeds placed in or designated to a reserve or other account at consummation.

For an example of the kind of arrangements I'm discussing, let's assume the loan is for construction costs only with no purchase or refinance involved. If the loan amount is for $100,000 and the creditor designates $10,000 of the loan proceeds to a reserve or other account, the creditor is not required to separately disclose the $10,000 because this amount is not an additional cost imposed on the consumer. It is a portion of the overall loan proceeds.

The creditor may disclose this designated amount as a separate itemized cost along with a separate itemized cost for the balance of the construction costs in accordance with Section 1026.37(g)(4) in Section H of the Loan Estimate which provides for an itemization of any other amounts in connection with the transaction that the consumer is likely to pay at closing or that the consumer has contracted with a person other than the creditor or loan originator to pay at closing.

The designated amount may be labeled construction holdback if that is what is called under the terms of the legal obligation, or if the designated amount is not given a specific label in the legal obligation, it may be labeled

Just to add further on this one, in this situation our borrower is making the repairs with cash brought in at closing and is not required to complete them prior to closing. Would that have any bearing on where we place the amounts?