AMC - Refund due?

We've just started using an appraisal management company to order our appraisals and we're having a disagreement on how to collect the fees. Management has decided to say a standard residential appraisal is $700. Of that, we'll pay a fee of around $150 so this leave $550 for the appraisal itself. If the appraisal were to come in for $400 then management wants us to keep the difference to cover for the times when the appraisal comes in higher than $550. Is this legal? Can we collect $700, pay out $550 and keep the difference?

If so, how do you disclose that on the Closing Disclosure?

Keep it - sure - you move it to Section A - label it an appraisal fee as it is payable to the bank and dump it into prepaid finance charges, since you didn't perform any services to earn the fee. Then defend yourself from:

1024.14 (c) No split of charges except for actual services performed. No person shall give and no person shall accept any portion, split, or percentage of any charge made or received for the rendering of a settlement service in connection with a transaction involving a federally related mortgage loan other than for services actually performed.

If we disclose two fees on the LE - say a $550 Appraisal and a $150 Appraisal Review Fee then I don't see how we could add a third fee on the CD into section A that wouldn't be a tolerance violation? Am I missing something?

My answer was a little tongue in cheek. Keeping or adding fees payable to the bank after the LE is issued is really not possible for a variety of reasons.

Thank god. I thought I had completely misunderstood everything I thought I knew about TRID. Thanks for the help.