On June 12, 2019, the U.S. Department of Agriculture-Rural Development Agency (RD) announced the implementation of a new guarantee underwriting user fee (also known as a “technology fee”) from lenders for each closed loan submitted via the Guaranteed Underwriting System (GUS).
The announcement provides that “any file submitted via GUS that is issued Form RD 3555-18E, ‘Conditional Commitment for Single Family Housing Loan Guarantee,’ on or after January 1, 2020, will require lenders to remit a one-time $25 technology fee with their loan closing package (i.e. the same time a lender currently remits the upfront guarantee fee).”
A Notice to Implement a Guarantee Systems User Fee for Lender Use of the Single Family Housing Section 502 Guaranteed Loan Program Automated Systems published in the Federal Register on July 13, 2018 states that the technology will be collected to enable funding of “future information technology enhancements needed to improve program delivery and reduce burden to the public.”
Chapter 16 of the Single Family Housing Guaranteed Loan Program Technical Handbook, HB-1-3555, is being revised to include further directions regarding the disclosure and collection of the technology fee. See link for 3555-1 Chapter 16 Final Advanced Copy 6-2019 here. Section 16.6 states that lenders may pass on the cost of the technology fee to the borrower. The fee can be included in the loan amount and becomes nonrefundable once the loan is closed and the Loan Note Guarantee has been issued. Section 16.6(B) states that the fee should be disclosed on the Loan Estimate and Closing Disclosure as “Services You Cannot Shop For/Services Borrowers Did Not Shop For” and titled as “USDA Technology Fee.”
DocMagic is working with our LOS partners on how to convey the information and will be making a system update to add the option of Technology Fee to the drop-down menu in the Charges/Fees screen in DocMagic Online. The charge will appear on applicable disclosures as “USDA Technology Fee.”