What Does a Cure Look Like?

 
A key component of the new HUD-1 form is the comparison or “walk-back” to the figures from the GFE.  Let’s dig down a bit and further examine what this new walk back means for settlement providers.  If you have a borrower sitting at the closing table, and their fees exceed allowed tolerances, what is the proper way to show a cure?  If your answer is “revise the settlement statement” … think about that for a minute.  Revise it to what? 

Revising the settlement statement in the past has always meant changing incorrect figures to make them accurate.  But in the case of tolerance violations… all of the fees shown for the GFE and HUD-1 are accurate.  They are just more expensive than the Good Faith Estimate allowed for. 

And what if a post-closing cure is needed for tolerance violations?  How do you maintain the historical integrity of both the GFE and HUD-1 forms while at the same time curing tolerance violations?  Is there a way to make your HUD-1 form right in these instances?  This is an entirely new function of the HUD-1 form and I’d like to hear your thoughts about how this will impact what you do.