B-164491, NOV. 15, 1968
Highlights
WHEREIN AN ITEM OF $291 WAS DISALLOWED BECAUSE IT REPRESENTED A CONSTRUCTION LOAN FEE INCURRED BY MR. MCCOLLOUGH AS A FEE PAID FOR PLANS AND SPECIFICATIONS REQUIRED BY THE BANK AND FHA FOR SECURING THE LOAN IS PROPER FOR REIMBURSEMENT. YOU SAY THAT THIS INFORMATION WAS VERIFIED WITH A MANAGER OF THE IDAHO FIRST NATIONAL BANK OF BOISE WHO STATED THAT THE 1 PERCENT SERVICE LOAN IS THE NORMAL CHARGE ASSOCIATED WITH ALL REAL ESTATE LOANS. SINCE IT NOW APPEARS THAT ONLY AN ADDITIONAL FEE OF 1/2 PERCENT WAS INCURRED FOR THE CONSTRUCTION LOAN AS COMPARED TO A CONVENTIONAL LOAN FOR THE PURCHASE OF A RESIDENCE. IN CONNECTION WITH THE CLAIM FOR REIMBURSEMENT OF $85 FOR PLANS AND SPECIFICATIONS THAT WERE REQUIRED BY THE BANK AND THE FEDERAL HOUSING ADMINISTRATION FOR SECURING THE LOAN.
B-164491, NOV. 15, 1968
TO MRS. NEDRA A. BLACKWELL:
YOUR LETTER OF OCTOBER 16, 1968, REFERENCE 360, REQUESTS RECONSIDERATION OF OUR DECISION OF AUGUST 20, 1968, B-164491, TO YOU, WHEREIN AN ITEM OF $291 WAS DISALLOWED BECAUSE IT REPRESENTED A CONSTRUCTION LOAN FEE INCURRED BY MR. THERON R. MCCOLLOUGH IN CONNECTION WITH THE PURCHASE OF A LOT AND CONSTRUCTION OF A RESIDENCE AT HIS NEW OFFICIAL STATION INCIDENT TO HIS TRANSFER FROM EPHRATA, WASHINGTON, TO COULEE DAM, WASHINGTON. ALSO, YOU ASK WHETHER ANOTHER ITEM OF $85 WHICH HAS BEEN CLAIMED BY MR. MCCOLLOUGH AS A FEE PAID FOR PLANS AND SPECIFICATIONS REQUIRED BY THE BANK AND FHA FOR SECURING THE LOAN IS PROPER FOR REIMBURSEMENT.
INFORMATION NOW HAS BEEN OBTAINED FROM THE LENDING BANK TO THE EFFECT THAT THE $291 FOR CONSTRUCTION LOAN COULD BE DIVIDED INTO TWO CATEGORIES - - NAMELY THE NORMAL 1 PERCENT LOAN SERVICE FEE, AND 1/2 PERCENT SERVICE FEE DUE ON CONSTRUCTION LOANS. YOU SAY THAT THIS INFORMATION WAS VERIFIED WITH A MANAGER OF THE IDAHO FIRST NATIONAL BANK OF BOISE WHO STATED THAT THE 1 PERCENT SERVICE LOAN IS THE NORMAL CHARGE ASSOCIATED WITH ALL REAL ESTATE LOANS.
SINCE IT NOW APPEARS THAT ONLY AN ADDITIONAL FEE OF 1/2 PERCENT WAS INCURRED FOR THE CONSTRUCTION LOAN AS COMPARED TO A CONVENTIONAL LOAN FOR THE PURCHASE OF A RESIDENCE, WE SEE NO OBJECTION TO REIMBURSING THE EMPLOYEE TO THE EXTENT OF 1 PERCENT OF THE FACE AMOUNT OF THE LOAN OR $194.
IN CONNECTION WITH THE CLAIM FOR REIMBURSEMENT OF $85 FOR PLANS AND SPECIFICATIONS THAT WERE REQUIRED BY THE BANK AND THE FEDERAL HOUSING ADMINISTRATION FOR SECURING THE LOAN, YOU REFER TO SECTION 4.2C OF CIRCULAR NO. A-56 WHICH PROVIDES IN PART AS FOLLOWS:
"* * * CUSTOMARY COSTS OF * * * MAKING SURVEYS, PREPARING DRAWINGS OR PLATS WHEN REQUIRED FOR LEGAL OR FINANCING PURPOSES * * * MAY BE REIMBURSED EITHER WITH RESPECT TO SALE OF THE RESIDENCE AT THE OLD OFFICIAL STATION OR PURCHASE OF A DWELLING AT THE NEW OFFICIAL STATION * *
THE DRAWINGS OR PLATES REFERRED TO IN THE REGULATION HAVE REFERENCE ONLY TO THE SALE OR PURCHASE OF A RESIDENCE. THE REGULATION DOES NOT CONTEMPLATE REIMBURSEMENT OF ANY ADDITIONAL FEES FOR PLANS AND SPECIFICATIONS REQUIRED BECAUSE AN EMPLOYEE ELECTS TO CONSTRUCT A RESIDENCE RATHER THAN PURCHASE ONE. ACCORDINGLY, THE ITEM OF $85 IS NOT PROPER FOR PAYMENT.
THE VOUCHER, WITH ATTACHMENTS, IS RETURNED HEREWITH FOR HANDLING IN ACCORDANCE WITH THE FOREGOING.