What will happen to seller paid home warranties under RESPA 2010?

This subject was raised by an attorney conducting a RESPA training session for the Pennsylvania Land Title Institute.  I attended the session a few months ago.

He took the position that the home warranty was a buyer cost that should be placed on the buyer side of the HUD with a credit on page one from the seller.

I have done two prelim HUDs using this method.  Neither transaction has closed and

What will happen to seller paid home warranties under RESPA 2010?

This subject was raised by an attorney conducting a RESPA training session for the Pennsylvania Land Title Institute.  I attended the session a few months ago.

He took the position that the home warranty was a buyer cost that should be placed on the buyer side of the HUD with a credit on page one from the seller.

I have done two prelim HUDs using this method.  Neither transaction has closed and

using an itemization of line #1101 for HUD prep

If you are not already using your own form, consider creating one.  It has made the process so much easier and maybe that is why I am enjoying prepping these new HUDs.

Here's how I do it.  As you know, we are doing our first PRELIM at the time we issue the title commitment, so at that time I have in hand the GFE with the provider list.

First I post all the GFE data in the system.  When I post

using an itemization of line #1101 for HUD prep

If you are not already using your own form, consider creating one.  It has made the process so much easier and maybe that is why I am enjoying prepping these new HUDs.

Here's how I do it.  As you know, we are doing our first PRELIM at the time we issue the title commitment, so at that time I have in hand the GFE with the provider list.

First I post all the GFE data in the system.  When I post

comments on Title Insurance Talk

Just a note to readers who wish to comment.  I love to hear from you because we all learn from each other and all the unique situations we face in real estate transactions.  It's better to NOT insert a link in your comment because I will likely reject the comment.  The only links I'll post through to comments are links that in my judgment add to the conversation.

comments on Title Insurance Talk

Just a note to readers who wish to comment.  I love to hear from you because we all learn from each other and all the unique situations we face in real estate transactions.  It's better to NOT insert a link in your comment because I will likely reject the comment.  The only links I'll post through to comments are links that in my judgment add to the conversation.

query: RESPA 2010 who pays the mortgage broker

The mortgage broker fees are part of the origination charge.  Lender and broker origination charges are lumped together.  The lender instructions to the title agent or attorney should spell out how much of that is to be remitted to the mortgage broker.

query: RESPA 2010 who pays the mortgage broker

The mortgage broker fees are part of the origination charge.  Lender and broker origination charges are lumped together.  The lender instructions to the title agent or attorney should spell out how much of that is to be remitted to the mortgage broker.

tax service fee for FHA and VA transactions

Our take is that you place the tax service fee on the buyer side of the HUD and put a credit on the first page from the seller.  Depending on the lender, they may allow the credit to be lumped in with a seller assist or they may want the tax service fee credit on a separate line. Either way works.

tax service fee for FHA and VA transactions

Our take is that you place the tax service fee on the buyer side of the HUD and put a credit on the first page from the seller.  Depending on the lender, they may allow the credit to be lumped in with a seller assist or they may want the tax service fee credit on a separate line. Either way works.

query: RESPA 2010 can you stop a closing due to a 10% tolerance issue

I'd sure be surprised if a lender permitted a HUD to go to closing without a cure, however they do have the option of closing and curing the tolerance violation within 30 days after closing.  In my non-attorney opinion a consumer must make a decision to close or not.  If it were me and I felt strongly that there was a tolerance violation, I would not close unless I had in hand a signed letter

query: RESPA 2010 can you stop a closing due to a 10% tolerance issue

I'd sure be surprised if a lender permitted a HUD to go to closing without a cure, however they do have the option of closing and curing the tolerance violation within 30 days after closing.  In my non-attorney opinion a consumer must make a decision to close or not.  If it were me and I felt strongly that there was a tolerance violation, I would not close unless I had in hand a signed letter

You won't believe it, but....

I had to do an old HUD today and I hated it!  It's SO not 2010.  LOL

I'm not kidding.  We're in a groove now and I'm grooving the new HUD!

You won't believe it, but....

I had to do an old HUD today and I hated it!  It's SO not 2010.  LOL

I'm not kidding.  We're in a groove now and I'm grooving the new HUD!

Signatures on the HUD-1 form? Keith raises a good point.

Hi Diane,

I came across your blog while doing some research.  I was thinking that a good topic for an upcoming entry would be regarding signature requirements for the HUD-1 settlement statement.  In my case, my copy of the HUD-1 has the signature of the Settlement Agent (I'm assuming that was someone at the title company I closed at), but not the signature of the sellers.  A call to someone at

Signatures on the HUD-1 form? Keith raises a good point.

Hi Diane,

I came across your blog while doing some research.  I was thinking that a good topic for an upcoming entry would be regarding signature requirements for the HUD-1 settlement statement.  In my case, my copy of the HUD-1 has the signature of the Settlement Agent (I'm assuming that was someone at the title company I closed at), but not the signature of the sellers.  A call to someone at

query: where do you put the FHA 203k escrow on the 2010 HUD-1?

Good question.  I haven't closed a renovation on the new HUD form yet, but have a few files pending.  My guess at this point is that the renovation escrow would be in the same section as the appraisal fee and FHA MIP.  What are your thoughts?

query: where do you put the FHA 203k escrow on the 2010 HUD-1?

Good question.  I haven't closed a renovation on the new HUD form yet, but have a few files pending.  My guess at this point is that the renovation escrow would be in the same section as the appraisal fee and FHA MIP.  What are your thoughts?

tax service fee - consumer shops for???

How exactly would consumers shop for this service?  Do tax service companies give individual quotes to consumers?  Just curious.  ;)

tax service fee - consumer shops for???

How exactly would consumers shop for this service?  Do tax service companies give individual quotes to consumers?  Just curious.  ;)

query: where can I get a copy of my HUD-1 statement

Hopefully it is in your filing cabinet because that's where it should be.  Every consumer should make certain they get a copy of their HUD-1 at closing.  Depending on some other party to maintain a copy and provide a back up when you need it is risky. 

Okay, so maybe you lost your copy or you never got one, what do you do now?  Call everybody else in the transaction.  Hope they are still in

query: where can I get a copy of my HUD-1 statement

Hopefully it is in your filing cabinet because that's where it should be.  Every consumer should make certain they get a copy of their HUD-1 at closing.  Depending on some other party to maintain a copy and provide a back up when you need it is risky. 

Okay, so maybe you lost your copy or you never got one, what do you do now?  Call everybody else in the transaction.  Hope they are still in

Can a loan officer casually give the borrower a name of a provider...

without including that provider on the "list"?  I say no.  What do YOU think?  I am not certain that folks have their compliance arms all around this issue.  I believe we have lenders with lists that contain names of providers and an expectation that loan officers will not give the consumer any other names.

Be safe.  If you mention a provider's name to your consumer, write the provider on your

Can a loan officer casually give the borrower a name of a provider...

without including that provider on the "list"?  I say no.  What do YOU think?  I am not certain that folks have their compliance arms all around this issue.  I believe we have lenders with lists that contain names of providers and an expectation that loan officers will not give the consumer any other names.

Be safe.  If you mention a provider's name to your consumer, write the provider on your

dare I say it....

I LOVE THE NEW HUD-1 !!

dare I say it....

I LOVE THE NEW HUD-1 !!

query: what does a HUD-1 look like?

Here's the new HUD-1 form.

Here's the new Good Faith Estimate form.

query: what does a HUD-1 look like?

Here's the new HUD-1 form.

Here's the new Good Faith Estimate form.

introducing GFE SOS for loan officers in our service market

Check it out.  The form is also linked from our web site just under the title insurance rate calculator.

introducing GFE SOS for loan officers in our service market

Check it out.  The form is also linked from our web site just under the title insurance rate calculator.

had our first closing today with the new HUD-1

All in all, I'd call it uneventful. We were prepared, the lender was prepared, the consumer didn't notice.  ;)

had our first closing today with the new HUD-1

All in all, I'd call it uneventful. We were prepared, the lender was prepared, the consumer didn't notice.  ;)

POC origination fee on new HUD?

We had a request from a mortgage lender today to do a small portion of the origination fee as POC. We weren't sure, so we checked.  No can do.  See the RESPA FAQ, page 41. 

Interestingly this lender has already closed at least one other transaction in which the title agent complied and did the POC.

We're all in this together and we're all on a learning curve.  Every day is interesting and

POC origination fee on new HUD?

We had a request from a mortgage lender today to do a small portion of the origination fee as POC. We weren't sure, so we checked.  No can do.  See the RESPA FAQ, page 41. 

Interestingly this lender has already closed at least one other transaction in which the title agent complied and did the POC.

We're all in this together and we're all on a learning curve.  Every day is interesting and

query: new respa requirements if a portion of the fees will be paid by the seller do tolerance levels still apply

Yes.  Costs that are typically buyer costs must be disclosed on the GFE even if the seller has agreed to pay a portion of the buyer costs.  The credit from the seller will be placed on page one of the HUD and will not be included as part of the tolerance calculations.  That means costs that DO fall within the tolerance rules must be accurate even if the seller is paying a portion. 

query: new respa requirements if a portion of the fees will be paid by the seller do tolerance levels still apply

Yes.  Costs that are typically buyer costs must be disclosed on the GFE even if the seller has agreed to pay a portion of the buyer costs.  The credit from the seller will be placed on page one of the HUD and will not be included as part of the tolerance calculations.  That means costs that DO fall within the tolerance rules must be accurate even if the seller is paying a portion. 

still curious about this RESPRO model indemnification agreement

Here's another blurb on it:

"HUD's new RESPA disclosures will, for the first time, subject mortgage originators to liability if certain final closing costs exceed those estimated on the Good Faith Estimate (GFE), which is provided three days after the loan application.  When a loan originator permits a borrower to shop for third-party settlement services, HUD requires the loan originator to

still curious about this RESPRO model indemnification agreement

Here's another blurb on it:

"HUD's new RESPA disclosures will, for the first time, subject mortgage originators to liability if certain final closing costs exceed those estimated on the Good Faith Estimate (GFE), which is provided three days after the loan application.  When a loan originator permits a borrower to shop for third-party settlement services, HUD requires the loan originator to

haven't talked about title for awhile..let's chat about getting a survey

Back in 2005 I insured a conveyance for a couple who purchased a lot that abutted a vacated alley.  The alley is the borderline between a township and a borough.  For tax assessment purposes the alley was deemed to be in the borough.  The neighboring lot sitting across the alley is in the township.  To keep things clear we'll call them BOROUGH  LOT and TOWNSHIP LOT.  These two lots are in two

haven't talked about title for awhile..let's chat about getting a survey

Back in 2005 I insured a conveyance for a couple who purchased a lot that abutted a vacated alley.  The alley is the borderline between a township and a borough.  For tax assessment purposes the alley was deemed to be in the borough.  The neighboring lot sitting across the alley is in the township.  To keep things clear we'll call them BOROUGH  LOT and TOWNSHIP LOT.  These two lots are in two

cash needed to close....how do you estimate using the new Good Faith Estimate?

Well, the good news is that you, the consumer, will get a more reliable disclosure of costs from all the lenders you shop - PLUS the disclosure will be on a uniform piece of paper.  That's great news for consumers.

There's one little tip you really need to think about and that's CASH TO CLOSE.

First, because lenders are on the hook for the estimates you can be assured the estimates will be a

cash needed to close....how do you estimate using the new Good Faith Estimate?

Well, the good news is that you, the consumer, will get a more reliable disclosure of costs from all the lenders you shop - PLUS the disclosure will be on a uniform piece of paper.  That's great news for consumers.

There's one little tip you really need to think about and that's CASH TO CLOSE.

First, because lenders are on the hook for the estimates you can be assured the estimates will be a

new GFE - interesting questions out the door....

It's January 5th and already I have had THREE circumstances cross my path that make me wonder.

A GFE shows the TAX SERVICE FEE and FLOOD LIFE OF LOAN FEE in the category designated for consumers to shop for services.  The "provider list" has providers for these two fees.  I know from prior transactions that this lender directs the business to their affiliated companies and hey - just how would a

new GFE - interesting questions out the door....

It's January 5th and already I have had THREE circumstances cross my path that make me wonder.

A GFE shows the TAX SERVICE FEE and FLOOD LIFE OF LOAN FEE in the category designated for consumers to shop for services.  The "provider list" has providers for these two fees.  I know from prior transactions that this lender directs the business to their affiliated companies and hey - just how would a

The Wilkersons take action, pronto!

Read this article:

OWINGS MILLS, Md. -- A local family who refinanced their home said they found out their original mortgage was never paid, and before they could get the problem resolved, the title company that did the leg work went out of business.According to state records, Maple Leaf Title Company had been in business since March 1999. But after August 2009, the company could not legally

The Wilkersons take action, pronto!

Read this article:

OWINGS MILLS, Md. -- A local family who refinanced their home said they found out their original mortgage was never paid, and before they could get the problem resolved, the title company that did the leg work went out of business.According to state records, Maple Leaf Title Company had been in business since March 1999. But after August 2009, the company could not legally