Q: Should a real estate commission be reflected on the Closing Disclosure?
A: Yes. Regulation Z does contain provisions that address real estate brokerage fees. As provided for in 1026.38(g)(4), such costs would be disclosed as “Other Costs” (section H). The commentary (in effect at the time of this post) includes the following clarification:
1. Costs disclosed. The costs disclosed under § 1026.38(g)(4) include all real estate brokerage fees, homeowner’s or condominium association charges paid at consummation, home warranties, inspection fees, and other fees that are part of the real estate closing but not required by the creditor or not disclosed elsewhere under § 1026.38.
4. Real estate commissions. The amount of real estate commissions pursuant to § 1026.38(g)(4) must be the total amount paid to any real estate brokerage as a commission, regardless of the identity of the party holding any earnest money deposit. Additional charges made by real estate brokerages or agents to the seller or consumer are itemized separately as additional items for services rendered, with a description of the service and an identification of the person ultimately receiving the payment.”