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#612915 - 09/13/06 07:38 PM "Stemwall" and " Foundation End" Fee's
Dollye7 Offline
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Dollye7
Joined: Jun 2006
Posts: 255
Southwest USA
I am calculating prepaids. Is anyone familiar with "Stemwall Endorsement Fee's" or "Foundation End Fee's"?

They are both payable to the title company that closed the construction loan. I was told by the title company that the "Stemwall EF", was for the title company to inspect the foundation after closing, to make sure that it did not cause an encroachment. It looks and smells like a prepaid -but what about the "Foundation End?"

I have a call in to the the title company on the "FE," and will consider them both PP's unless there is a reason not to...

Thanks!

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Lending Compliance
#612916 - 09/14/06 01:39 AM Re: "Stemwall" and " Foundation End" Fee's
rlcarey Offline
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rlcarey
Joined: Jul 2001
Posts: 79,672
Galveston, TX
3. Charges assessed during the loan term. Real estate or residential mortgage transaction charges excluded under 226.4(c)(7) are those charges imposed solely in connection with the initial decision to grant credit. This would include, for example, a fee to search for tax liens on the property or to determine if flood insurance is required. The exclusion does not apply to fees for services to be performed periodically during the loan term, regardless of when the fee is collected. For example, a fee for one or more determinations during the loan term of the current tax lien status or flood insurance requirements is a finance charge, regardless of whether the fee is imposed at closing, or when the service is performed. If a creditor is uncertain about what portion of a fee to be paid at consummation or loan closing is related to the initial decision to grant credit, the entire fee may be treated as a finance charge.
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#612917 - 09/14/06 01:53 PM Re: "Stemwall" and " Foundation End" Fee's
Dollye7 Offline
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Dollye7
Joined: Jun 2006
Posts: 255
Southwest USA
Randy - thanks a million!

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