Seller's Fee in Tolerance Calculation

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Question:

When we have a TRID loan that we have already issued the loan estimate to the borrower, and we find out that the borrower will be paying the seller’s fees at closing. Do we have to include the seller’s fee in with our tolerance calculation since the buyer is paying it? Let’s say we have state/tax stamps, usually paid by the seller. At closing we find out the buyer is paying the fee. This is a zero tolerance fee, do we have to add it into our tolerance calculation since it is a seller’s fee just being paid by the buyer?

Answer:

If you find out that a fee that is subject to the tolerance tests that is customarily paid by the seller and is now going to be paid by the buyer, then that would be a changed circumstance allowing to re-issue a disclosure (either LE or CD) within three business days to reset your tolerance baselines. The key is when you know or should have known about this fact. Typically, this would be addressed in the purchase contract for the property. The day you came in possession of a copy of the purchase contract would start your three day clock for re-disclosure, not for instance when the title company, buyer or seller, called it to your attention just before closing.