Back to DM Help
DocMagic Compliance Articles:
Charges
Charge Code/Description
Enter the code that corresponds to the charge. The charge code enables defaulting of the charge description and indicates whether or not the charge should be included in the prepaid finance charge based on the default list that has applicable citations here: APR / Finance Charges Matrix
The Prepaid Finance Charge and Section 32 default Y/N flags can easily be changed if you desire. If you require modification of these or any other default or automatic entries, simply contact DSI. In many cases DSI has assumed that charges that may be considered part of the Section 32 analysis should be considered. Sometimes this is not the case. Our assumptions result in a conservative computation in that 100% of the time a transaction is subject to Section 32, we will detect and properly indicate by the use of the required disclosures.
However, this conservative approach may also trigger the use of the required disclosures in certain cases where the transaction is not subject to Section 32. It is a wise idea to closely scrutinize all charges in an attempt to more precisely compute the Section 32 analysis. As indicated above, all assumptions can be changed to meet your requirements.
To
Enter the appropriate party that a fee is being paid to. The proper selection of the field will trigger necessary disclosures. If you're unsure who a fee is being paid to, please check with your investor to confirm the appropriate classification.
Charge Amt
Indicate the amount of the charge in this field. Even when a charge has been paid or will be paid at closing, enter the amount in this field. DocMagic will automatically insert '$', ',' and '.' signs in all numeric fields for you.
When a buydown has been indicated in the Buydown Code field above, a default entry of the required buydown funds will automatically be computed. Note: The aggregate adjustment charge has been eliminated, as an Aggregate Adjustment field has been added to the Impound section below. Required: No
Paid By
Indicate the party responsible for paying this charge.
Amount Paid
Enter the amount of the charge that has been paid. The difference between the charge amount and the paid amount is the amount to the charge currently outstanding.
POC?
Has this charge been paid outside of closing?
APR?
This field is determined based on the charge code selected. To view our default APR matrix for the DocMagic Charges, please click here: APR / Finance Charges Matrix.
Fees
Fee Description
Enter the code that corresponds to an entry in the loan fee pop-up list. The fee code distinguishes the loan fee description and whether the fee point percentage amount will apply to the loan amount as entered or the base loan amount (loan amount less MIP premium financed-FHA loans only). Loan fee types consist of borrower/seller points and borrower/seller discount points. Generally discount points are utilized in FHA/VA transactions only. Most conventional loan fees will consist of point (origination) fees only, while FHA/VA loans will often have origination and discount point fees.
In the case of a FHA/VA transaction, point fee computations will be computed based upon the base loan amount. The base loan amount is computed by subtracting any mortgage insurance premiums financed from the loan amount as entered. All discount point fee computations will be computed based on the loan amount as entered. An FHA sample loan fee entry, assuming a loan amount of $101,500.00 (base loan amount of $100,000.00 + mortgage insurance premium of $1,500.00), might look like this:
Fee Code | Fee Description | Fee to | Points | Fee fixed | Paid By |
O | ORIGINATION FEE | L | 1.000 | - | B |
D | DISCOUNT FEE | B | 1.000 | - | B |
The origination fee would be computed by multiplying the point figure (1.000) by the base loan amount ($100,000.00) which would result in a $1,000 origination fee. The borrower discount fee, however, would be computed by multiplying the point figure (1.000) by the loan amount as entered ($101,500.00) which would result in a $1,015 discount fee. Remember that loan fees that are paid by the borrower are included in the prepaid finance charge and subsequently effect the APR while loan fees that are not paid by the borrower do not affect the prepaid finance charge.
To
Indicate who the discount fee is being paid to.
Fee Points
Show the percentage of the loan amount to be charged as a loan fee. In the case of an FHA loan with the mortgage insurance premium financed, the point entry percentages will apply only to the base loan amount (the loan amount less the mortgage insurance premium financed fee). Discount point entry percentages, however, will apply to the loan amount as entered.
+Fee Fixed
Show any fixed dollar amount to be charged in ADDITION to any points indicated. Note: This Fee amount is ADDED to the point(s) computation. Very often users will erroneously place the full origination fee in this field in addition to indicating the number of points this effectively results in loan fee that is twice as much as it should be.
Paid By
Enter the party that the loan fee will be paid by.
APR?
Fees that are included in the APR have the box checked.
DocMagic Compliance Articles:
Bona Fide?
DocMagic Compliance Articles:
GSE Bona Fide?
DocMagic Compliance Article:
RSS