Question:
An OCC examiner recently cited our bank for not disclosing a coupon book company as a required provider of settlement services on the Good Faith Estimate form (which has the required provider information at the bottom of the form). I was under the impression that a financial institution should disclose only those service provider companies that were required in the origination, processing, or funding of the loan. The coupon book is required for the servicing of the loan, which, in essence, is not a settlement service. The coupon book fee that our bank charges is disclosed as a prepaid finance charge under TILA. It is a fee that our bank charges to offset the cost of the production of the coupon book for installment loans. This fee could very well be incorporated into our loan fee with an increase for the cost of the coupon book, but we choose to charge the customer separately for a loan fee and a coupon book fee. The coupon book fee is $10.00, and we disclose the fee on the Good Faith Estimate and the HUD1 or HUD1A, since all costs to the borrower must be disclosed. Should we be itemizing the coupon book company as a required provider?
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