i have received this question from our home loan person:

I’m working with a new vendor on our loan estimate . They obtain the title and settlement fees from our preferred providers import them into our origination software then guarantee the fees so that we don’t have to pay tolerance cures.

My trouble is that the title companies are bundling these fees. I can’t find anything on line to confirm or deny that we can do this. Can you reach out to your sources and find better information for me? So far the fees are in line with whether or not they are APR required fees.

They can't be bundled.

37(f)(5) Item descriptions and ordering.

1. Clear and conspicuous standard. Section 1026.37(f)(5) requires creditors to label the loan costs disclosed pursuant § 1026.37(f) using terminology that describes each item. A creditor complies with this requirement if it uses terminology that is clear and conspicuous, consistent with § 1026.17(a)(1), and describes the service or administrative function that the charge pays for in a manner that is reasonably understood by consumers within the space provided in form H-24 of appendix H to this part. For example, if a creditor imposes a fee on a consumer to cover the costs associated with underwriting the transaction, the creditor would comply with § 1026.37(f)(5) if it labeled the cost “Underwriting Fee.” A label that uses abbreviations or acronyms that are not reasonably understood by consumers would not comply with § 1026.37(f)(5).

Starting HERE in the Bureau's proposed amendments to the TRID rule there is a discussion of a proposed change to comments 19(e)(1)(vi)-2 and -4 that would "clarify that, if the charge for a particular service for which the consumer is permitted to shop is payable by the consumer, the creditor must specifically identify that service unless, based on the best information reasonably available, the creditor knows that the service is provided as part of a package (or combination of settlement services) offered by a single service provider. Proposed revised comment 19(e)(1)(vi)-2 would also further clarify that specific identification of each service in such a package is not required provided that all such services are services for which the consumer is permitted to shop."

That change would only affect items included in section C of the LE and listed in the written list of providers.

Currently, as pointed out earlier in this discussion, this sort of latitude in listing packaged or bundled services isn't expressly given.

Doing some audit follow-up where this was a finding. For those who have been able to monitor the intricacies of proposed amendments, did the above proposal ever make it to print?

Comments closed yesterday. I assume that you didn't write a comment letter?? Final is scheduled for release 1st quarter or so.

I did not. I'm partial to the itemizing anyways since the bundling completely blurs what could and could not be in the bundled service.

The creditor doesn't bundle services, the service provider provides services as a bundle for a specific charge.

I hope it sticks. It's impractical to truly itemize every detail and attorney charges for that is part of their service fee...other than title exam, insurance, their doc prep for perfecting/transferring title or a specific fee for closing the loan, which most here just consider a part of the process, itself, and don't have a specific category for...anyway...it's logistically impossible to itemize each action down that far.

So you work with a title company and agree upon the standard list of services and costs it includes in the majority of cases, and use that. Then you get the title company to give you an early heads up if it has to add a cost to a particular file and why, so you can stand a chance of getting a revised LE out the door in time.

I am new to commenting on proposals. Regarding this proposal, is there any indication of when a decision might be made and the rule published in the Federal Register? I've searched through the proposal and am starting to believe this was omitted by design.

I do see that the rule is proposed to be final 120 days after publication.

https://www.federalregister.gov/d/2016-18426/p-91


Thanks for your assistance.

Norman,

I do think the Bureau wants to get the final rule out as quickly as possible, because it's largely a regurgitation of one-off guidance and corrections or clarifications that the industry has been clamoring for. So, unless there's a huge number of adverse comments or comments requiring additional changes, I think we might see something with three months of the end of the comment period.

Thanks John. One more question about proposals and comments. I recently submitted comment on the private policy changed for flood insurance. I submitted via email because I couldn't find the rule on FederalRegister.gov.

Is there typically some delay between when the proposal comes out and when it is opened up for comment on FederalRegister.gov?

Yes. I've seen proposals go from announcement to publication on a same-day basis, and delayed as long a several weeks.

Thank you sir.

Still watching for this one. If I'm correct, there has been no notice of change yet. Please let me know if I missed the finalization of the rule/proposal.

Not sure which one you're asking about, but there's been nothing final on either the TRID rule revisions or the guidance on private flood insurance policies.

Thanks John. I was looking at the bundling of fees proposal.

Looks like March:

https://www.reginfo.gov/public/do/eAgendaViewRule?pubId=201610&RIN=3170-AA61

Yes, it would appear that the Bureau, when it set its Fall 2016 Regulator Agenda, felt that a March 2017 final rule date was attainable.
Experience tells us that March is the soonest we can expect it, and that these targets often "slip" a bit.

Thank you gents. Randy, you always seem to find some hidden link that I either did not know existed or could not find.

Hint -- Randy's been in the game longer than many in these forums, and his experience is broader than most. We are very fortunate to have him as a participant and BOL Guru.

I sure hate the CFPB sometimes. I've spent entirely too long reading this document and still have questions.

http://files.consumerfinance.gov/f/docum...ements_TILA.pdf

Beginning on page 67 of the link above.

If the Bureau has decided not to adopt the amendments allowing for the disclosure of "package" settlement services but instead requires that the FI disclose only those services for which the borrower is allowed to shop and which are required by the creditor, what happens to all of the other "ancillary" fees that will inevitably appear on the CD? I'm thinking in terms of notary fee, title search fee, etc. (pg. 69).

Do those fees remain absent from the LE and just appear on the final CD? Will they be subject to unlimited tolerance?

If I'm babbling, I'm sorry. I've had my head in this for far too long.