In response to a June 2008 joint letter from NAR and Washington RESPA attorney Jay Varon, HUD General Counsel, Helen R. Kanovski, provided informal answers to questions regarding what are often referred to as administrative fees or similarly named fees charged to consumers in real estate transactions. The January 22, 2010 letter discusses the ways to account for charges and circumstances where charges are appropriate or less appropriate. The letter notes that all charges to sellers and buyers must be disclosed on line 700 of the HUD-1 and that RESPA does not prescribe how an agent or broker determines the charge, noting it could be a flat fee, percentage, or combination of both. The letter concludes with the usual caveats that it does not provide protection from liability. Nevertheless, the letter does represent HUD's latest thinking on this issue and provides some reasonable parameters for agents and firms with regard to disclosing and charging fees or commissions. RESPA attorney, Phil Schulman, has written an article for NAR's RESPA Realities webpage — www.realtor.org/respa — explaining how HUD's guidance affects REALTORS®.

HUD's January 22, 2010 Letter
Schulman Article