Disclose Fees Borrower Doesn’t Pay?

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Question:

Our bank does not charge the borrower a credit report fee when applying for a loan. Therefore, we do not include the fee on the final HUD or on the Reg Z disclosures. We are being questioned as to why not by our internal auditor. His view is that we must disclose all fees related to the transaction even if the borrower did not pay for it.

Answer:

I'm sure you are probably charged per report pulled and the bill itemizes those charges.

For loans subject to RESPA you would have show the credit report charge on line 804 as a POC item.

See 3500.7(a)(2).

First published on BankersOnline.com 4/06/09