Claim for Relocation Expenses and Real Estate Finance Charges

A decision was requested on the propriety of certifying for payment certain items and amounts claimed which represented real estate expenses in connection with the purchase of a residence incident to transfer of station. The reimbursement of relocation expenses is governed by regulations which prohibit the reimbursement of any item which is found to be a finance charge under Regulation Z. Lump-sum loan origination fees were finance charges and may not be reimbursed. The commmitment fee was incident to the extension of credit and must be considered to be part of the finance charge and as such is not reimbursable. The same applies to the underwriting fee claimed, a fee charged by the financing entity to cover a fee charged by the underwriter for reviewing each loan which the entity sends. The new loan tie-in fee paid to the lending agency was in the nature of a service charge and is not allowable. The subescrow fee was paid by the claimant to the settlement agent as part of the charges for the loan closing. Since such charge by the agent was customary, the payment is reimbursable as an incidental expense. Accordingly, only the subescrow fee may be certified for payment.