Broker to Broker Question - Disclose compensation as points?

RESPA governs the GFE. You must disclose the GFE as mandated in the regulations. The GFE discloses the origination fee and any discount fees as a dollar amount and not a percentage amount, so I'm not sure what form you want to modify. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com 888-889-9950

You don't have to disclose the %.. You are only required to disclose the $$ amount.. Whatever $$ amount you put in box 1, you're stuck with.. it cannot go up... and if your transaction is lender paid, it cannot go down.. Your broker should be able to explain this in detail.. But it would take more than a line or two to explain on this post.. i work with guys who have been in the business for 20 years, and they don't know how to properly disclose the new GFE and how broker compensation is figured... it's not that they are dumb.. it's just really confusing... I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

Sadly, stupid government "improvements" to the Good Faith Estimate has only served to confuse clients - not help them. But, we all have to live with the exact same forms, so a good loan officer should have no trouble explaining the forms, and should never lose a deal because of it. Talk to some other top producing Loan Officers in your office and have them teach you how they disclose properly and legally.

You can't really alter fees but you can explain the Lender Paid % better. On how it is now required to show on the GFE as an origination and then credited back to them. This shows them what the lender is paying the broker for the loan however what they should focus on is the adjusted origination charge. That is all they are being charged.

Hello, Lenders/Brokers should be playing by the same rules, so it's not a matter of trying to get around disclosing the fee's...but it's about how you explain the fee's. For example: In box A on Page 2 of the GFE you may put a charge of 1% which will equal $2,000 on a $200,000 loan, but say if your company only charges a flat fee of $1,500, then you can put in a lender credit of $500 which makes the net amount to borrower of $1,500 in box A. The discount point and the lender credit can be completed on #2 of your fee's worksheet in the POINT system if that's what your company uses as a brokerage most do. Hope this helps!

Dollar amount is what is mandated. RESPA guidelines state that the dollar amount must be accurate.