USDA Technology Fee Implementation on January 1, 2020
On January 1, 2020 the USDA Single Family Housing Guaranteed Loan Program will begin to assess and collect a fee (aka Technology Fee) from lenders on each closed loan that was submitted via the Guaranteed Underwriting System (GUS). Specifically, any file submitted via GUS that is issued Form RD 3555-18E, "Conditional Commitment for Single Family Housing Loan Guarantee," on or after January 1, 2020, will require lenders to remit a one-time $25 Technology Fee with their loan closing package (i.e. the same time a lender currently remits the Upfront Guarantee Fee).
An advanced copy of Handbook-1-3555 Chapter 16 provides direction on the disclosure and collection of the Technology Fee along with a new section on frequently asked questions for loan closings.
Helpful Information has been extracted from the Handbook, but Lender must review the Section 16.6, Chapter 16 of the USDA Handbook (7 CFR 3555.107) for detailed guidance. Please see specific requirements for how the fee is to be labelled and where it is to be disclosed on the Loan Estimate and Closing Disclosure.
- Fee may be passed from Lender onto Borrower.
- Fee may be included in the loan amount subject to maximum LTV thresholds.
- Fee is non-refundable once the loan is closed and Loan Note Guarantee has been issued.
- Failure to pay the Technology Fee at time of closing will result in denial of Loan Note Guarantee.
- Must be disclosed on Loan Estimate in Section B "Services You Cannot Shop For".
- Must be disclosed on Closing Disclosure in Section B "Services You Cannot Shop For".
- Must be titled "USDA TECHNOLOGY FEE" on both disclosures.