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B-232679 1 (1988-11-14)

handle is hein.gao/gaobadngs0001 and id is 1 raw text is: 0The Comptroller General of the United States Wahington, D.C. 20548 Decision Matterof. Michael J. Murphy - Loan Origination Fee File: B-232679 Date: November 14, 1988 DIGEST A transferred employee who purchased a residence at his new duty station may not be reimbursed for the tull amount of a loan origination fee of 2.5 percent. Although he has demonstrated by a Federal Home Loan Bank's survey that a fee of 2.5 percent was customary in the locality for the conventional financing involved, the fees reflected in the survey include not only loan origination fees but also discounts and points which are not reimbursable expenses. DECISION This decision is in response to a request from John E. Totten, Chief of the National Office of the Financial Branch, Internal Revenue Service (IRS), Department of the Treasury, concerning the claim of Mr. Michael J. Murphy, an employee of the IRS, for reimbursement of a loan origination fee. The fee was incurred when Mr. Murphy transferred trom Philadelphia, Pennsylvania, to Washington, D.C., and purchased a residence at his new duty station which he financed by a conventional adjustable rate mortgage. He paid a 2.5 percent loan origination fee in the amount of $5,000 at closing in January 1988. Although he claimed reimbursement for the full amount of the loan origination tee, the agency reimbursed him only $2,000, an amount equal to a 1 percent loan origination fee. Mr. Murphy relies on our holding in Steven C. Krems, 65 Comp. Gen. 447 (1986), to support his claim for a 2.5 percent loan origination fee. In Krems, supra, we held that an employee was entitled to reimbursement for a 3 percent loan origination fee because he demonstrated by a Federal Home Loan Bank's survey of local lenders that a 3 percent fee was customary in the locality for the particular type of conventional financing involved. o +:,g-4 9'O

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