Good Faith Estimate - 10% tolerance

Posted By: Dodge

Good Faith Estimate - 10% tolerance - 11/07/18 10:48 PM

When we sent the title company a request for a quote on title fees we gave them the wrong loan amount; therefore, the title fees disclosed on the Loan Estimate were way off.

The borrower decided use another title company, but we will still be held to the 10% tolerance since we did not make a good faith estimate?
Posted By: rlcarey

Re: Good Faith Estimate - 10% tolerance - 11/07/18 11:27 PM

Lack of good faith makes the charge subject to 0% tolerance:

19(e)(3)(iii) Variations permitted for certain charges. - Comment 2

For example, if the consumer informs the creditor that the consumer will choose a settlement agent not identified by the creditor on the written list provided under § 1026.19(e)(1)(vi)(C), and the creditor discloses an unreasonably low estimated settlement agent fee of $20 when the average prices for settlement agent fees in that area are $150, then the under-disclosure does not comply with § 1026.19(e)(3)(iii) and good faith is determined under § 1026.19(e)(3)(i).
Posted By: Cridal_Z

Re: Good Faith Estimate - 10% tolerance - 11/14/18 07:46 PM

What happens if the settlement provider listed on our SSPL ADDS a fee, payable to said settlement agent, would that fee be subject to the tolerance limits even though the fee wasn't disclosed on our SSPL?

We have a company who pushes over their fees to us from Smart Fees, so that our LE numbers are in line with what should be charged at closing, but then on occasion they add a notary fee (so that fee/service was not on our SSPL). We have to charge it, but I was of the thinking that because the notary fee wasn't a disclosed fee it did not fall in with the other tolerance items that were listed.
Posted By: John Burnett

Re: Good Faith Estimate - 10% tolerance - 11/14/18 08:14 PM

See revised comment 19(e)(3)(ii)-2.ii. You treat it as though it is part of the 10% bucket.
Posted By: rlcarey

Re: Good Faith Estimate - 10% tolerance - 11/15/18 08:55 PM

What John was citing.


ii. Assume that, in the disclosures provided under § 1026.19(e)(1)(i), the sum of all estimated charges subject to § 1026.19(e)(3)(ii) equals $1,000. If the creditor does not include an estimated charge for a notary fee but a $10 notary fee is charged to the consumer, and the notary fee is subject to § 1026.19(e)(3)(ii), then the creditor does not violate § 1026.19(e)(1)(i) if the sum of all amounts charged to the consumer subject to § 1026.19(e)(3)(ii) does not exceed $1,100, even though an individual notary fee was not included in the estimated disclosures provided under § 1026.19(e)(1)(i).
Posted By: Cridal_Z

Re: Good Faith Estimate - 10% tolerance - 11/16/18 08:54 PM

Thank you!