I'm an auditor from Texas, so I'm needing replies from those that know Texas laws. I have a client that had a 3% Home Equity tolerance cure on a loan of over $200 that they correctly showed on Page 1 of the HUD. However, they also had a 10% RESPA tolerance issue on Page 3 of the HUD, which showed that a $19 cure needed to be paid. Mine and their question is...can you consider the 3% Home Equity cure to also be satisfaction of the RESPA 10% cure or are they considered two separate issues (state vs federal) and the bank gets dinged twice? Compliance Alliance states that it can be used to cure both, but they have not shown where they are getting their information from. Has anyone else dealt with this and/or had an examiner state whether it's allowed or not? I'd appreciate no opinions but actually verifiable answers as I need to be able to provide the same to my clients, if possible. Thanks in advance for your help!

Call the Department of Banking and ask them.

IMHO - they are not the same. A cure to prevent a violation of State law has no impact on the fact that the GFE and HUD-1 were not in tolerance. The credit for the 3% tolerance cure should have been reflected as a lender credit on the GFE.

I agree with Randy. Two separate regulatory violations and cures. I would relate it to a reimbursable Reg. Z violation and a RESPA tolerance violation. The Reg. Z reimbursement cures the Reg. Z violation but is does not cure the RESPA tolerance violation.