[kmeade]

Would it be a violation of Section 8 if an Attorney that a bank uses regularly does a title opinion for a family member at no charge? The loan purpose would be to remodel a dwelling that will become the borrower’s primary residence? The property is in the process of being transferred to the borrower, but not before the construction loan is originated. The current property owner will sign the mortgage for the construction loan, not the note.

[Brent V]

A violation of Section 8 occurs when a person gives or receives a fee, kickback or other thing of value pursuant to any agreement or understanding, oral or otherwise, that business incident to or part of a settlement service.

• Waiving a fee constitutes a “thing of value.”
• The bank refers business to the attorney. If the attorney waives the fee for the bank then a Section 8 concern arises.
o The question does not clarify whether the family member is a member of the attorney’s family or is a member of a bank employee’s family.
 If the attorney waives fees for a member of his or her own family, that is not a Section 8 issue.
 Waiving the fee for a member of a bank employee’s family may raise a concern.

[Author]

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