The new GFE has generated countless questions and more confusion than even we could expect. If you haven’t already seen it, the Niche Report published an article by Joshua Weinberg that really helps walk you through the process and explains it in clear detail. You can find the article here.
But if you would prefer to step through the process in Point specifically, I’m about to make your day. This is all about the YSP and how you report it in your software so that it appears in the correct spot in the borrower’s file.
Yield Spread Premium (YSP) will ONLY be considered as a credit to the borrower. All compensation to the Originator expects to receive must be clearly indicated up front, and may not change. This means that Originators are required to enter any and all amounts they desire to be compensated with on line item 801: Loan Origination Fee on the Initial Fees Worksheet.
- Go to the Initial Fees Worksheet.
- In the Compensation to Broker section, enter the YSP.
**You must enter YSP here so that it will transfer to the GFE 2010 as a credit.
- Scroll down to the 1300: Additional Settlement Costs section.
- Enter the YSP into any of the user defined fields as a negative number. (For example: -2000)
**You must enter the YSP again into this section so that the YSP is applied as a credit on Loan Application Pg. 4 to be included in “Cash to Close.”
- Go to the Good Faith Estimate 2010.
- Check the box, Borrower receives a credit of…
**Checking the box applies the YSP as a credit on the GFE 2010