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B-214018 1 (1984-06-27)

handle is hein.gao/gaobadltp0001 and id is 1 raw text is: ?~THE COMVPTINOLILEN ONNERAL DECIION OP THE UNITED ETATES WASHINGTON. O.C. 30548 FILE: B-214018 DATE: June 27, 1984 MATTER OF: Roger J. Salem - Real Estate Expenses Loan Origination Fee DIGEST: A transferred employee who purchased a new residence incurred a 5 percent loan fee which was described in the loan agreement as a loan origination fee. The agency allowed reimbursement for only 1 percent of the loan amount, based on HUD's advice that a I percent loan origination fee is customary in the local area, and the employee has reclaimed the additional 4 percent. The agency's determination to allow reimbursement for 1 percent of the loan amount is sustained, based on the advice provided by HUD. The employee's claim for the additional 4 percent is denied because that portion of the fee represents a nonreimbursable mortgage discount. Mr. W. D. Moorman, an authorized certifying officer of the United States Department of Agriculture, requests our decision concerning the reclaim of Mr. Roger J. Salem, an employee of the Department's Office of Inspector General. The issue for our determination is whether Mr. Salem may be reimbursed for the full amount of the 5 percent loan fee he incurred when purchasing a residence at his new duty sta- tion, based on the lender's characterization of the entire fee as a loan origination fee. We hold that the employee was properly reimbursed for only 1 percent of the 5 percent fee for the reasons stated below. BACKGROUND Effective May 1, 1983, Mr. Salem was transferred from Indianapolis, Indiana, to Chicago, Illinois. He purchased a new house in Chicago, entering into a loan agreement which required the payment of a loan origination fee of $4,500, 02-pi z1

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