Help! We disclosed to our borrower as we normally do with fees that are typical for our area.In our area revenue stamps or tax transfer fees are a seller expense. Our borrower is buying a foreclosure and their Purchase Agreement states that the buyer pays the revenue stamps. (again, that is not typical for our area and not disclosed.) Now they are attempting to charge them on the HUD to our borrower. Now we are out of tolerence. Do we have to eat the revenue stamps? The purchase agreement shouldn't dictate our fees should it? How can I fix this... we're talking a $1000.

The HUD should show the charge in the sellers' column on page 2.
On page 1 you do a credit from the buyer to the seller in the 200/500 section.

Caveat: If FNMA is the seller on this, you're sol. They dictate how the HUD must be prepared and they will force you to put it in the borrower's column and cure for it. This flies in the face of all that RESPA says but they just don't care. It's another perfect case of one tentacle of the government not caring how another tentacle is operating.

I think TRs solution is appropriate. However, we had a similar situation (several actually). In MA, the seller pays transfer taxes, so we disclosed $0 on the GFE for transfer taxes. Nobody bothered to notice that the property address was in ME (I think). In ME, it is customary for the seller and buyer to split the transfer taxes. Since the loans had alredy closed (without anyone noticing the tolerance violations somehow), I made the bank reimburse the consumer.

Your situation is trickier because you probably don't have a P&S by the time you issue the GFE, so there's no way to know of this unusual arrangement. This is why I think TR's response is appropriate.

I agree that the purchase contract does not trump how you would normally issue a GFE. The HUD is the bank's responsibility so fill it out the way TR recommends and you should not have a tolerance violation.