Wholesale VA Fees and Charges Policy & Procedure

Overview

Department of Veteran Affairs (VA) loan programs are available for service members and veterans (collectively “veterans”) only. VA regulations limit the loan fees that a veteran can pay to obtain a loan. Lenders must strictly adhere to the limitations on veteran-paid fees and charges when making VA loans.

Policy

Refer to the following documents for detailed policy information and the VA fee matrix:

·       VA Allowable Fees Policy

·       VA Allowable Fee Matrix

VA State Deviation Policy

Always refer to the VA State Deviations Table for an exceptions to fees in the “Included in the 1% Limit” category.

Seller and Lender Credits

If the total of fees subject to the VA 1% limit exceed the threshold, an itemized Lender Credit (PE) and/or an itemized Seller Credit may be applied to those fees to bring the total within the 1% limitation.

·       When a Seller Credit is applied to a fee that is subject to the 1% limit, the fee will be excluded from the 1% calculation.

·       When a Lender Credit is applied to a fee that is subject to the 1% limit, the fee will be excluded from the 1% calculation only if the Lender Credit is the result of a pricing exception (PE).

·       When a Lender Credit from premium pricing (rate rebate) is applied to a fee that is subject to the 1% limit, the fee will NOT be excluded from the 1% calculation.

VA Funding Fee (VA Standard and VA IRRRL)

It is the Broker’s responsibility to correctly identify the correct VA Funding Fee amount, for disclosure on the initial Loan Estimate (LE).  Broker is also responsible for providing the Certificate of Eligibility (COE) and the VA Form 26-8937.

Should the Broker become aware of a change to the Funding Fee, the Broker must notify LDW within three (3) business days by  completing and submitting a Change in Circumstance (COC) form located in the Broker Portal.

Fees Paid by Lender

If the total of fees subject to the VA 1% limit exceed the threshold, after applying a Lender Credit for pricing exception and/or available Seller Credits, loanDepot Wholesale (LDW) will allow up to $500 in excess fees to be ‘Paid by Lender’ without additional authorization. 

Any amount of fees subject to the VA 1% limit, that exceeds $500, will need to be reduced and/or Paid by Lender with required authorization.

Itemization of Fees

VA requires all allowable fees and charges to the borrower and any Lender/Seller Credits must be listed in the appropriate column(s) on the Closing Disclosure (CD). Fees charged to the veteran must be listed in the “Borrower-Paid”, Seller Credits in the “Seller-Paid” and Lender Credits placed in the “Paid by Others” columns. A separate itemized list of credits and charges are not acceptable.

CD example / instructions

V.I.E 08.15.2019