Closing Costs

View the "Loan Templates" Quick Reference Guide 

A Closing Cost is a template of predefined values that display primarily on the 1003 application, the Good Faith Estimate statement (for loans using the 2010 RESPA forms) , and the Loan Estimate (for loans using the 2015 RESPA-TILA disclosure forms). You can significantly reduce data entry time and improve accuracy by setting up closing cost templates for the types of loans you process most often.

When you select a closing cost template to use with a loan, the data from the template is copied to the loan forms. You can leave the data as is, or change values as needed. The original data on the template is not affected.

About public and personal closing cost templates

To Create a Closing Cost Template:

  1. On the menu bar, click Encompass, and then click Settings.

  2. In the left panel, click Loan Templates, and then click Closing Costs.

  3. On the Closing Costs setting, select the Public or Personal folder in which to add the template.

  4. Click the New icon, select the option to apply the template to the 2010 Itemization or the 2015 Itemization.

     Using the RESPA-TILA Form Version option located at the top of the Forms menu, an authorized user can open a loan file and select an option to use the 2015, 2010, or pre-2010 version of the RESPA-TILA forms for the current loan file. Note that the option to switch between versions of loan forms is no longer available after a loan has been disclosed to a borrower.

  5. Type the name of the template, and then (with the new template selected) click the Edit icon.

  6. On the Closing Cost Template Details window, type a Description, and complete the form as described below.

    The fields in section 700 are used to designate the distribution and payers of sales and broker commissions on the HUD-1 Page 2 form.

  7. If the data in a template conflicts with a business rule, select the Template data will ignore business rules checkbox to ignore the conflicting business rule and apply the template data to the loan.

    • If the checkbox is not selected, the business rule will take precedence over the template data.

     This feature is available only if it has been enabled by your system administrator (using the Settings Manager in the Admin Tools) and applies only to public templates.

  8. When finished, click Save.

Guidelines and Section Information

ClosedGeneral Guidelines

  • Type the costs and fees assigned to the borrower, seller, or both. As necessary, type a description of the cost in the space provided.

  • Use the Paid To list and the three checkboxes to specify the payee and other characteristics of the fee.

  • If the template is for the 2010 Itemization, use the Paid By list to specify who will pay the fee. If the template is for the 2015 Itemization, you can also click the Fee Details icon associated with the fee and use the Amount Paid by section of the Fee Details window to specify who will pay the fee.

  • With templates that are applied to 2015 Itemization, data entered in the Fee Details windows is copied to the form when the template is applied to a loan.

  • For calculated fields, Encompass places the value in the Borrower field. If you type a value in the associated Seller field, that amount is deducted from the Borrower value.

  • Click the Address Book icon to select providers from your business contacts. If you type a name in a field, you can then right-click to add a new contact to your business contacts.

  • In the 900, 1000, 1100, 1200, and 1300 sections, use the Edit icons to open a calculator to determine the associated field value.

  • In the Government Recording and Transfer Charges section, use the Find icons to select predefined formulas to calculate the charges.

ClosedCost and Fee Designations

When you record costs and fees in sections 700 through 1300, use the Paid By and Paid To lists and the three checkboxes to specify the payor, payee, and other characteristics of the fee.

  1. Type the amount of the fee in the Borrower or Seller columns (or both).

  2. If the value in the Borrower column will be paid by someone other than the borrower, use the Paid By dropdown list to indicate who will pay the fee, Broker (B), Lender (L), or Other (O).

  3. If the template is for the 2010 Itemization, select one or more checkboxes as appropriate:

    • P -(Paid outside closing/Paid through closing) When the P checkbox is selected, a pop-up window allows you to indicate how much of the fee is being paid outside closing (POC) or through closing (PTC). For instructions on entering POC and PTC fee on the Closing costs template, refer to the topic for entering POC and PTC fees on the 2010 Itemization.

    • B (Borrower select) - The borrower will locate a provider for the service.

    • A (APR fees) - Borrower costs that are used to calculate the APR.

    • Use the Paid To list to indicate the recipient of the fee: Broker (B), Lender (L), Other (O), Seller (S) or Investor (I).

  4. If the template is for the 2015 Itemization, you can select one or more checkboxes as appropriate in sections 800 through 1300.

    • P (Paid outside closing/Paid through closing) - All or part of the fee is being paid outside closing (POC) or paid through closing (PTC).

    • B (Borrower select) - The borrower has opted to locate a provider for this service. Selecting this checkbox causes both the Borrower can shop for and Borrower did shop for checkboxes to be selected on the Fee Details window for the fee. Clearing one or both of the checkboxes on the Fee Details window also clears this checkbox on the 2015 Itemization.

    • A (APR fees)  - Borrower costs that are used to calculate the APR.

    • Use the Paid to column in sections 800 through 1300 to indicate to whom the fee will be paid.

      • L (Lender) - The fee is paid to the lender (creditor).

      • S (Seller) - The fee is paid to the seller. The value is placed in the From GFE Seller column on the MLDS.

      • I (Investor) - The fee is paid to the investor.

      • A (Affiliate)- The fee is paid to an affiliate of the lender or the broker

      • O (Other)- The fee is paid to someone other than the broker, lender, seller or investor. The value is placed in the Paid To Others column on the MLDS.

  5. If the template is for the 2015 Itemization, you can click the Fee Details icon to the left of a fee entry to open the Fee Details pop-up window. Use the pop-up windowto edit the information entered in the checkboxes and the Paid to and Paid by dropdown lists described above. The Fee Details window enables you to enter more detailed information about the fees, including the entities who are paying the fee in part or in whole (Borrower, Seller, Broker, Lender, and Other), the amount paid by each entity, and the portion of the payment that falls into different payment categories (Financed, PTC, PAC, and POC). Changes made in the pop-up window are reflected on the amounts shown on the 2015 Itemization.

  6. B (Broker) - The fee is paid to the broker. The value is placed in the Paid To Broker column on the MLDS.

ClosedSection 700

The distribution and payors of sales and broker commissions.

ClosedSections 800 through 1300

800
Fees paid in connection with the loan, typically by the borrower.

900
Fees for future services, such as mortgage insurance for the upcoming year, that are paid when the loan closes.

1000
Fees deposited in the escrow account established by the lender.

1100
Fees collected by the lender when the loan closes, and then distributed to outside service providers.

1200
Fees collected by the lender when the loan closes, and then distributed to local and state agencies. For lines 1202 through 1206, you can use the Find icons to select a predefined formula to calculate the associated value.

1300
Charges and other miscellaneous fees not already recorded in sections 800 through 1200.

See Also:

Work with Closing Cost Templates

Import Loan Programs

2010 Itemization

2015 Itemization