Which fees are NOT allowed to be included in the maximum mortgage calculation?
Fees typically paid by the seller under local or state law, or local custom, such as real estate commissions, charges for pest inspections, fees paid for trustees to release a deed of trust, etc., are not considered contributions.
I’m a new FHA processor. Can someone please answer my one MCAW question?
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Fees typically paid by the seller under local or state law, or local custom, such as real estate commissions, charges for pest inspections, fees paid for trustees to release a deed of trust, etc., are not considered contributions.
References :
Prohibited payments by lenders include:
A. Unearned fees. A lender is not permitted to pay any fee, compensation, or thing of value:
1. Other than for services actually performed.
2. That is a kickback.
3. Above that actually paid for the service.
4. To any party for referring the loan (a finder’s fee).
5. To a party that has or will receive other payment for the service, except in the case of a commission for selling hazard insurance policy
at the request of the borrower.
6. That is prohibited by the Real Estate Settlement Procedures Act (RESPA).
B. Advances. Advancing funds in anticipation of commissions on sales to be financed with FHA-insured mortgages is prohibited.
C. Loans. A lender may not make below-market or no-interest loans to a real estate broker, real estate agent, mortgage broker, packager, builder, or any other party from whom the lender accepts proposals involving FHA-insured mortgages.
For a forward mortgage, the lender can collect from the borrower those customary and reasonable closing costs necessary to close the mortgage. However, borrowers may not pay a tax service fee and may not pay more than a one percent loan origination fee.
Aggregate closing costs charged to a borrower may not violate FHA’s tiered pricing rules and all charges must be properly disclosed to the borrower.
References :
FHA DE underwriter and credit analyst since 1979