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#2199436 - 11/29/18 09:32 PM Lender Credit to Lender (L) Paid
Cheli Offline
Platinum Poster
Cheli
Joined: May 2013
Posts: 919
Reviewing an originated loan-
My FI understated an Appraisal fee by $50. Instead of just adding the $50 cure to the CD by simply lender paying in the "Paid by Others" column, the staff member who prepared the last LE added a $50 lender credit.

The CD has the $50 lender pay in the 3rd column, but does my FI still need to cure the 0% tolerance for the $50 lender credit they erroneously placed on the LE?
I am pretty sure it needs to be cured. Looking for some support/guru opinion...

Thank you!

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TRID - TILA/RESPA Integrated Disclosures Rule
#2199486 - 11/30/18 02:58 PM Re: Lender Credit to Lender (L) Paid Cheli
John Burnett Offline
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John Burnett
Joined: Oct 2000
Posts: 40,086
Cape Cod
If the LE appraisal fee was $450 but the actual appraisal fee was $500, the financial institution can (1) only charge the borrower $450 ($450 in the borrower-paid column on page 2 of the closing disclosure and $50 in the paid by others column -- with or without the (L) symbol; OR (2) put the full $500 in the borrower-paid column and increase the Lender Credits in section J by $50. It does not do both. Be careful that a finance charge isn't mishandled by your system if you split the cost on page 2 between the borrower and the lender.

If you can do it, method (1) is preferable, since it can avoid all the "increased by more than allowed" language in the Calculating Cash to Close table and in the Lender Credits area.

But for a given service, you should never be using both method (1) and method (2).
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John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

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#2199647 - 12/03/18 04:22 PM Re: Lender Credit to Lender (L) Paid Cheli
Cheli Offline
Platinum Poster
Cheli
Joined: May 2013
Posts: 919
Thank you s much, John...sorry for the delayed response.

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