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#2294642 - 03/11/24 10:45 PM Loan Estimate: Fees that we "know" about
Tarhe Offline
Diamond Poster
Joined: Nov 2006
Posts: 1,462
California
On the Loan Estimate, we are only required to disclose those fees that the bank requires. On the CD, we must disclose all costs “associated with the transaction”. We are seeing loans with fees that I'm not sure if they must be disclosed on the LE or wait until CD, even though we "know" about them.

Scenario: Mobile home park selling off the individual units of land to the current mobile home owners who have been renting their spaces. There are 3 new fees that we want to make sure we are disclosing correctly: 1) a capital contribution fee to initially fund the HOA; 2) the first month's HOA dues; and 3) a sewer fee to transfer the sewer bill to the consumer. All of the applications we will receive will incur these 3 fees. Since we "know", does that require us to disclose them on the LE under "Other" and the HOA Dues (under "Prepaids)? (The sewer bill will vary but the other 2 fees will be the same for all applications.) These are not necessarily required by the bank but are required by the entity selling off the plots of land to the folks currently renting their spaces. So, do they need to be on the LE?

Perhaps the sewer bill could be considered required by the Bank to get a clear title in the land records - in which case, should we put it in Section B?

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Lending Compliance
#2294658 - 03/12/24 02:05 PM Re: Loan Estimate: Fees that we "know" about Tarhe
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 47,803
Bloomington, IN
1026.37

(g) Closing cost details; other costs. Under the master heading “Closing Cost Details,” in a table under the heading “Other Costs,” all costs associated with the transaction that are in addition to the costs disclosed under paragraph (f) of this section. The table shall contain the items and amounts listed under six subheadings, described in paragraphs (g)(1) through (6) of this section.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

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#2294664 - 03/12/24 03:03 PM Re: Loan Estimate: Fees that we "know" about Tarhe
Tarhe Offline
Diamond Poster
Joined: Nov 2006
Posts: 1,462
California
Thank you!

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#2299623 - 07/23/24 03:15 PM Re: Loan Estimate: Fees that we "know" about Tarhe
Tarhe Offline
Diamond Poster
Joined: Nov 2006
Posts: 1,462
California
A follow up . . . one of the requirements is that before we fund the loan (and after it has been approved), the foundation has to go on for a large fee. The seller often pays this - it is negotiated. Since we know this fee will always be incurred, do we need to disclose it on the Loan Estimate? (It will be disclosed on the Closing Disclosure in the correct column as to who pays it.) The question is should it go on the Loan Estimate, too?

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#2299628 - 07/23/24 03:29 PM Re: Loan Estimate: Fees that we "know" about Tarhe
Tarhe Offline
Diamond Poster
Joined: Nov 2006
Posts: 1,462
California
I re-read Dan's 1026.37 reference and that answered my question. We should be disclosing this fee on our LE as well as our CD.

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