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#58500 - 01/31/03 05:18 PM Document Preparation Fee
krmabyrd Offline
New Poster
krmabyrd
Joined: Jan 2003
Posts: 18
Chicago Southland
Is it required to disclose on a HUD-1 or HUD-1A a fee that is treated as part of the finance charge? It is my understanding that the HUD-1 or HUD-1A is only for disclosing the amount financed (loan amount).

Thanks for any feedback you may have available.

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Lending Compliance
#58501 - 01/31/03 05:24 PM Re: Document Preparation Fee
Anonymous
Unregistered

On a HUD-1 or HUD-1A, you need to disclose all fees (finance charges and "other" charges) that are part of a transaction. The loan amount would also be shown on this document

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#58502 - 01/31/03 05:32 PM Re: Document Preparation Fee
Lucy Griffin Offline

Diamond Poster
Lucy Griffin
Joined: Nov 2000
Posts: 1,544
The "amount financed" is a Truth in Lending calculation and disclosure. Don't mix this up with the HUD-1 disclosures that are required by RESPA. While there are many cross-references, these are two separate requirements.

RESPA uses the HUD-1 to disclose to the customer all settlement costs, including the cost of credit. This goes beyond the fees that Truth in Lending discloses because those are limited to the cost of credit.

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#58503 - 01/31/03 07:31 PM Re: Document Preparation Fee
OnTheEdge Offline
Diamond Poster
Joined: Apr 2002
Posts: 1,677
SmallTown, USA
Generally, in Consumer R/E transaction "doc prep" fee can be excluded from Finance Charge if reasonable and bonafide.
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