If at the time of LE disclosure, we're aware that an applicant has selected his/her own title company - and is not going with the financial institution's preferred provider - do we list the 3rd party title company and their fees on the LE? In all circumstances we will still provide a list of our preferred providers.

Thanks.

"In all circumstances we still provide a list of our preferred providers."

Your list must match the fees you are quoting on the LE. You can't use Title Company A's fees on the LE and then give Title Company B as your provider on the provider list. I don't let the applicant control our provider list--we quote our provider regardless.

(The normal caveat about the provider you quote having to perform the service in the area obviously apply.)

Thank you for the response. To play devil's advocate, can we list the 3rd party title company's fees on the LE and simply not provide a preferred providers list to that applicant but provide the list of preferred providers to all other applicants?

If my bank's policy were to let them shop for title services, i wouldn't want to go "cannot shop" on a one-off basis because they already know which title company they want to use. IMO, your 2 options are: 1) stay with your provider and quote their fees or 2) quote the provider that you know they are going to use and then create a provider list with that provider on the list.

Not giving a list means you aren't letting them shop, which means those services are 0% tolerance. I wouldn't trust a one-off title company to that degree.

Ok, thank you very time for the additional explanation. If we utilize option 1 above - stay our with provider and quote their fees - do we then immediately issue a revised LE using fees from the third party title company selected by the applicant?

No, there is no reason to issue a revised LE. You are letting them shop--if they choose a provider not on your list, there's no reason to re-issue....those fees automatically move to "did shop for" on the CD and cause you no tolerance issues....they become unlimited tolerance items.

Of course - I was absolutely overthinking things. Again, thanks for the help and guidance.

Yw

I agree with raitchjay on this. To explain this another way: You are sort of providing a guarantee (my word) when you put a provider on your service provider list as you are essentially saying that we guarantee the fees will be very close to what we said they would be. This is why the fees from a title company on your list go in section B of the CD and are limited to 10%. If you don't want to guarantee the fees of a provider, then you don't put them on their list and their fees go in section C of the CD. As raitchjay said, I would be hesitant to provide a guarantee for a one-off title company that you have never worked with before and know nothing about. It is just easier to tell the customer that we guarantee the fees of this one provider we know well, but you are free to shop and take the fees of any provider you choose.

May I please request a citation for the below statement that our LE must match our preferred provider list? Thanks again for the patience and assistance.

(iii) Variations permitted for certain charges. An estimate of the following charges is in good faith if it is consistent with the best information reasonably available to the creditor at the time it is disclosed, regardless of whether the amount paid by the consumer exceeds the amount disclosed under paragraph (e)(1)(i) of this section:

(A) Prepaid interest;

(B) Property insurance premiums;

(C) Amounts placed into an escrow, impound, reserve, or similar account;

(D) Charges paid to third-party service providers selected by the consumer consistent with paragraph (e)(1)(vi)(A) of this section that are not on the list provided pursuant to paragraph (e)(1)(vi)(C) of this section; and

(E) Charges paid for third-party services not required by the creditor. These charges may be paid to affiliates of the creditor.

"
"
If you give a list that has provider A's fees on it, but then quote provider B and the borrower chooses provider B, they aren't on your list....but they are on your list....i think that paradox alone basically tells you that you must quote the fees of one or the providers on your list (the industry standard tends to be to give only one provider, but you can give multiple providers if you like....but at least one of your multiple providers must be the fees that you are then quoting).

Excellent - thanks! I tried to back my way into the above analysis using 1026.19(e)(1)(vi)(C)-3 and 1026.37(f)(3), but the above cite is more on point and easier to understand.

yw

I'm curious if this analysis changes at all come October 1, 2018 with the amended TRID requirements, specifically the good faith tolerance requirement referenced on page 4 of this https://s3.amazonaws.com/files.consumerf...ifications.pdf.

My exact scenario is as follows: we verbally notify applicant of title fees and our preferred provider. Applicant elects to go with a third-party not on our preferred provider list which has higher title fees than our preferred provider. The LE contains the higher title fees from the third-party and we provide our preferred provider list along with the LE.

Can we make an argument that providing the third-party higher title fees on the LE is in good faith since it's based upon the best information reasonably available?

Thank you.

Absolutely...but I kinda cringe at that word 'preferred provider'. You give a shopping list with your quoted provider...not any type of restricted list they have to choose from, right?

On the initial LE - you give them your provider list and list your provider's fees on the LE - period. There is no requirement or should you try to determine, 1) if the borrower is going to select your provider or 2) what any other provider may charge them. At the time you issue a subsequent LE, if they did not choose your provider, then you will then put the actual provider fees on the subsequent disclosures to the best of your knowledge.

That's correct - we provide a list with the provider that is typically quoted, but applicants are not restricted to choosing a provider on our list. Applicants can select a provider of their own choosing.

However, based upon the above comment the 2017 TRID Rule didn't change anything, so we do not have the option of disclosing a provider not listed on our written list of providers.

Thanks for the information.

There has been no change:

Original: " The settlement service providers identified on the written list required by § 1026.19(e)(vi)(C) must correspond to the settlement services for which the consumer may shop, disclosed pursuant to § 1026.37(f)(3)."


Amended: "The settlement service providers identified on the written list required by § 1026.19(e)(1)(vi)(C) must correspond to the required settlement services for which the consumer may shop, disclosed under § 1026.37(f)(3). "

We're now exploring changing our provider to more closely align with the company that's most frequently utilized. I'd like to identify any other locations in which our provider is documented besides on our written list of providers. Anyone aware of any other documents I should review listing our selected service provider? Thank you.

I'd like to identify any other locations in which our provider is documented besides on our written list of providers.

Not sure I quite understand the question?

I can only speak for my LOS and the SPL would be the only place they are listed until you finalize things for a CD and list the actual provider.

Thanks - I didn't anticipate any other documents/notices/disclosures containing the name of our selected service provider either.