If the borrower is getting a “no cost” loan, must the lender list charges the lender is going to pay?

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If the borrower is getting a “no cost” loan, must the lender list charges the lender is going to pay?

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Yes. The charges to be shown on the GFE and the HUD-1 must include any payments by the lender to affiliated or independent settlement providers. These payments should be shown as POC (paid outside of closing). So now you’ve seen the quick answer from me and HUD and the long answer from the regs, let me leave you with one other thing you ought to know. We frequently get calls from consumers wanting to know why one GFE is so much lower than the another company’s estimate. If I have time, instead of the short answer of telling them to compare to see that each has the same types of charges, I’ll ask about typical charges that are left off when low-balling a GFE to get the consumer in the door or have them fax me what they have. If all the usual fees aren’t listed on the GFE, we’ll probably be calling to find out why. So you can save yourself the call, by doing it right. Estimate the fee even if you are going to pay it and mark it POC.

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