Flood Determination Life of Loan Fee Disclosure

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Question:

I have been told that the flood determination life of loan fee is determined to be a pre-paid finance charge. How do we need to disclose this on the HUD and GFE? Do I disclose the life of loan fee combined with the flood fee or do I need to separate it out into two separate fees? If they need to be two separate fees, could you please tell me the regulation and subsection under which it would be found?

Answer:

The GFE and Settlement Statements are not used to determine finance charges, so it doesn't matter if they are listed separately or combined on the RESPA forms. RESPA simply tells us to list them. It may be a software issue if you are breaking them out as non-finance charges (determination) and finance charges (life of loan portion), but it's not a RESPA issue.

First published on BankersOnline.com 4/19/10