US LAWS, STATUTES & CODES ON-LINE

[FTR Amdt. 98, 66 FR 58196, Nov. 20, 2001; 67 FR 7219, Feb. 15, 2002]

“Equitable title interest” in your residence is determined by your agency if:

(a) The title is held in trust, and:

(1) The property is your residence;

(2) You and/or a member(s) of your immediate family are the only beneficiary(ies) of the trust during either of your lifetimes;

(3) You and/or a member(s) of your immediate family retain the right to distribute the property during your lifetimes;

(4) You and/or a member(s) of your immediate family retain the right to manage the property;

(5) You and/or a member(s) of your immediate family are the only grantor/settlor of the trust, or retain the right to direct distribution of the property upon dissolution of the trust or death; and

(6) You provide your agency with a copy of the trust document; or

(b) The title is held in the name of a financial institution, and:

(1) The property is your residence;

(2) You and/or a member(s) of your immediate family executed a financing agreement (e.g., mortgage) with the financial institution;

(3) State or local law requires that lending parties take title to perfect (i.e., protect) a security interest in the property, or the financial institution requires that it take possession of title as a condition of the financing agreement; and

(4)You provide your agency with a copy of the financing document; or

(c) The title is held both in the names of:

(1) You solely, or jointly with one or more members of your immediate family, or one or more members of your immediate family;

(2) An individual accommodation party as defined in §302–11.106 who is not a member of your immediate family; and

(3) The conditions apply:

(i) The property is your residence.

(ii) You and/or a member(s) of your immediate family have the right to use the property and to direct conveyance of the property.

(iii) The lender requires signature of the accommodation party on the financing document.

(iv) You and/or a member of your immediate family, are liable for payments under the financing arrangement (e.g., mortgage).

(v) The accommodation party's name is on the title.

(vi) The accommodation party does not have a financial interest in the property unless the employee and/or a members(s) of the immediate family default on the financing arrangement.

(vii) You must provide documentation of the accommodation that is acceptable by your agency; or

(d) The title is held by the seller of the property and the following conditions are met:

(1) The property is your residence;

(2) You and/or member(s) of your immediate family has the right to use the property and to direct conveyance of the property;

(3) You and/or member(s) of your immediate family must have signed a financing agreement with the seller of the property (e.g., a land contract) providing for fixed periodic payments and transfer of title to the employee and/or a member(s) of the immediate family upon completion of the payment schedule; and

(4) You provide your agency with a copy of the financing agreement; or

(e) Another equitable title situation exists where title is held in your name only or jointly with you and one or more members of your immediate family or with you and an individual who is not an immediate family member, and the following conditions are met:

(1) The property is your residence.

(2) You and/or a member(s) of your immediate family has the right to use the property and to direct conveyance of the property.

(3) Only you and/or a member(s) of your immediate family has made payments on the property.

(4) You and/or a member(s) of your immediate family received all proceeds from the sale of the property.

(5) You must provide suitable documentation to your agency that all conditions in paragraphs (e)(1) through (e)(4) of this section are met.

An accommodation party is an individual who signs an employee's financing agreement (e.g., a mortgage) to lend his/her name (i.e., credit) to the arrangement.

Provided that they are customarily paid by the seller of a residence at the old official station or by the purchaser of a residence at the new official station, your agency will pay the following expenses:

(a) Your broker's fee or real estate commission that you pay in the sale of your residence at the last official station, not to exceed the rates that are generally charged in the locality of your old official station;

(b) The customary cost for an appraisal;

(c) The costs of newspaper, bulletin board, multiple-listing services, and other advertising for sale of the residence at your old official station that is not included in the broker's fee or the real estate agent's commission;

(d) The cost of a title insurance policy, costs of preparing conveyances, other instruments, and contracts and related notary fees and recording fees; cost of making surveys, preparing drawings or plats when required for legal or financing purposes; and similar expenses incurred for selling your residence to the extent such costs:

(1) Have not been included in other residence transaction fees (i.e., brokers' fees or real estate agent fees);

(2) Do not exceed the charges, for such expenses, that are normally charged in the locality of your residence;

(3) Are usually furnished by the seller;

(e) The costs of searching title, preparing abstracts, and the legal fees for a title opinion to the extent such costs:

(1) Have not been included in other related transaction costs (i.e., broker's fees or real estate agency fees); and

(2) Do not exceed the charges, for such expenses, that are customarily charged in the locality of your residence

(f) The following “other” miscellaneous expenses in connection with the sale and/or purchase of your residence, provided they are normally paid by the seller or the purchaser in the locality of the residence, to the extent that they do not exceed specifically stated limitations, or if not specifically stated, the amounts customarily paid in the locality of the residence:

(1) FHA or VA fees for the loan application;

(2) Loan origination fees and similar charges such as loan assumption fees, loan transfer fees or other similar charges not to exceed 1 percent of the loan amount without itemization of the lender's administrative charges (unless requirements in §302–11.201 are met), if the charges are assessed in lieu of a loan origination fee and reflects charges for services similar to those covered by a loan origination fee;

(3) Cost of preparing credit reports;

(4) Mortgage and transfer taxes;

(5) State revenue stamps;

(6) Other fees and charges similar in nature to those listed in paragraphs (f)(1) through (f)(5) of this section, unless specifically prohibited in §302–11.202;

(7) Charge for prepayment of a mortgage or other security instrument in connection with the sale of the residence at the old official station to the extent the terms in the mortgage or other security instrument provide for this charge. This prepayment penalty is also reimbursable when the mortgage or other security instrument does not specifically provide for prepayment, provided this penalty is customarily charged by the lender, but in that case the reimbursement may not exceed 3 months' interest on the loan balance;

(8) Mortgage title insurance policy, paid by you, on a residence you purchased for the protection of, and required by, the lender;

(9) Owner's title insurance policy, provided it is a prerequisite to financing or the transfer of the property; or if the cost of the owner's title insurance policy is inseparable from the cost of other insurance which is a prerequisite;

(10) Expenses in connection with construction of a residence, which are comparable to expenses that are reimbursable in connection with the purchase of an existing residence;

(11) Expenses in connection with environmental testing and property inspection fees when required by Federal, State, or local law; or by the lender as a precondition to sale or purchase; and

(12) Other expenses of sale and purchase made for required services that are customarily paid by the seller of a residence at the old official station or if customarily paid by the purchaser of a residence at the new official station.

Reimbursement may exceed 1 percent (as specified in §302–11.200(f)(2) only when you provide evidence that the higher rate:

(a) Does not include prepaid interest, points, or a mortgage discount; and

(b) Is customarily charged in the locality where the residence is located.

Your agency will not pay:

(a) Any fees that have been inflated or are higher than normally imposed for similar services in the locality;

(b) Broker fees or commissions paid in connection with the purchase of a home at the new official station;

(c) Owner's title insurance policy, “record title” insurance policy, mortgage insurance or insurance against loss or damage of property and optional insurance paid for by you in connection with the purchase of a residence for your protection;

(d) Interest on loans, points, and mortgage discounts;

(e) Property taxes;

(f) Operating or maintenance costs;

(g) Any fee, cost, charge, or expense determined to be part of the finance charge under the Truth in Lending Act, Title I, Pub. L. 90–321, as amended, and Regulation Z issued by the Board of Governors of the Federal Reserve System (12 CFR part 226), unless specifically authorized in §302–11.200;

(h) Expenses that result from construction of a residence, except as provided in §302–11.200(e)(10); and

(i) Losses, see §302–11.304.

Yes, your agency will reimburse you no more than:

(a) Ten percent of the actual sales price for the sale of your residence at the old official station; and

(b) Five percent of the actual purchase price of the residence for the purchase of a residence at the new official station.

To request reimbursement for the expenses you incur for your residence transaction, you must:

(a) Send your claim for reimbursement and documentation of expenses to your old official station for review and approval unless otherwise specified by your agency, and

(b) Follow your agency's procedures and submit appropriate voucher(s) along with any claim applications that your agency may require with appropriate documents specified in §302–11.302.

To request reimbursement for the sale of a former residence or the purchase of a new one, you must submit to your agency:

(a) Copies of your sales agreement when selling a residence;

(b) Your purchase agreement when a purchasing a residence;

(c) Property settlement documents;

(d) Loan closing statements; and

(e) Invoices or receipts for other bills paid.

No, the Government will not reimburse you for expenses incurred in connection with your residence transactions if they are paid by someone other than you or a member of your immediate family.

No, losses incurred due to market conditions or prices at your old and new duty station are not reimbursable when incurred by you due to:

(a) Failure to sell a residence at the old official station at the price asked, or at its current appraised value, or at its original cost; or

(b) Failure to buy a dwelling at the new official station at a price comparable to the selling price of the residence at the old official station; or

(c) Any losses that are similar in nature to (a) or (b).

No, reimbursement of any residence transaction expenses (or settlement of an unexpired lease) that occurs prior to being officially notified (generally in the form a change of station travel authorization) is prohibited.

You are responsible for the determination of reasonableness for your claimed expenses. To determine if your expenses are reasonable, you should, in coordination with your agency, contact the local real estate association, or, if not available, at least three different realtors in the locality in which your expenses will be incurred and request:

(a) The current schedule of closing costs which applies to the area in which you are buying or selling;

(b) Information concerning local custom and practices with respect to charging of closing costs which relate to either your sale or purchase and whether such costs are customarily paid by the seller or purchaser; and

(c) Information on the local terminology used to describe the costs specified in paragraph (b) of this section.

No, you may not receive an advance of funds for your residence transaction expenses.

When you purchase or sell land in excess of what reasonably relates to the residence site, your reimbursement will be limited to a pro rata reimbursement of the land reasonably related to the residence site.

If the employee violates his/her service agreement, no residence transaction expenses will be paid, and any amounts paid prior to such violation shall be a debt due the United States until they are paid by the employee.

To request reimbursement for settlement of an unexpired lease, you must itemize expenses (list all expenses separately) on a travel voucher and submit the voucher to your agency.

When you share a lease with someone else you will be reimbursed on a pro rata basis for that portion of the lease that you are responsible for.

Note to subpart E: Use of pronouns “we”, “you”, and their variants throughout this subpart refers to the agency.

You must establish internal policies and procedures to implement this part.

You may authorize or approve a residence transaction expense allowance when an employee is performing a permanent change of station in the interest of the Government and has signed a service agreement (other than a new appointee or an employee assigned under the Government Employees Training Act (5 U.S.C. 4109.); and

(a) The old and new official stations are located in the United States; or

(b) The employee has completed an agreed upon tour of duty overseas and is returning to the United States to an official station that is at least 50 miles away from the employees last official station in the United States; or

(c) When the employee has been permanently assigned to a temporary official station.

The following are not eligible to receive residence transaction expense allowances:

(a) New appointees; and

(b) Employees assigned under the Government Employee's Training Act (5 U.S.C. 4109).

You must establish policies that will define what documentation is acceptable from an employee when requesting reimbursement of residence transaction expenses.

When paying allowances for expenses incurred in connection with residence transactions, you must:

(a) Determine who will authorize and approve residence transactions expenses on the employee's travel authorization;

(b) Determine who will review applications for reimbursement of residence transaction expenses;

(c) Determine who will authorize extensions beyond the 2-year limitation for completing sales and purchase or lease termination transactions, under §§302–11.420 and 302–11.421;

(d) Prescribe a claim application form which meets your internal administrative requirements;

(e) Require employees to submit a travel claim with appropriate documentation to support his/her payment of the expenses claimed, which must include as a minimum;

(1) The sales agreement,

(2) The purchase agreement,

(3) Property settlement documents,

(4) Loan closing statements, and

(5) Invoices or receipts for other bills paid; and

(f) Require employees to submit travel claims to his/her old official station for review and approval of the claim unless agency review and approval functions are performed elsewhere except as provided in §302–11.405.

The hiring agency in the locality of the employee's old official station must review and approve the employee's application when the employee transfers between agencies, unless the hiring agency does not have an appropriate installation there. In that case, the losing agency at the old official station must review and approve the expenses.

To administer an employee's claim:

(a) You must:

(1) Review the employee's claim to determine whether the expenses claimed are reasonable in amount and customarily paid by the buyer/seller in the locality where the property is located;

(2) Disallow any portion of the employee's claim that is inflated or are higher than normal for similar services in the locality;

(3) Execute final administrative approval of payment of a claim by an appropriate agency approving official; and

(4) Return disapproved applications to the employee with a memorandum of explanation.

(b) The approving official must determine if:

(1) The aggregate amount of expenses claimed in connection with a sale or purchase of a residence is within the prescribed limitation for either;

(2) All conditions and requirements under which allowances may be paid have been met; and

(3) The expenses themselves are those which are reimbursable.

Note to §302–11.406: You must not pay the expenses listed in §302–11.202 or §302–11.304.

Before paying residence transaction expenses, you must require the employee to submit:

(a) A copy of his/her financial documents which prove that only the employee and or a member(s) of the immediate family made payments on the property;

(b) A copy of his/her financial documents which prove that he/she and/or a member(s) of the immediate family received all proceeds from the sale of the property;

(c) Documentation that is acceptable by you in verifying any interest that the employee has in the property; and

(d) Any additional documents that you need to verify payments.

You may authorize an additional period of time, not to exceed 2 years, for completion of the sale and purchase or lease termination transactions.

When authorizing an extension of time limitation, you must determine that the:

(a) Employee has extenuating circumstances which have prevented him/her from completing his/her sale and purchase or lease termination transactions in the initial authorized time frame of two years; and

(b) Employee's residence transactions are reasonably related to his/her transfer of official station.

You must reimburse an employee in lieu of residence transaction expenses when the employee meets the requirements of §302–11.10 for expenses incurred due to settlement of an unexpired lease.

You must require that the employee submit an appropriate travel claim requesting reimbursement for expenses of an unexpired lease settlement with:

(a) An itemization of all expenses claimed supported by documentation showing that the employee indeed paid all lease settlement fees; and

(b) A total amount for all expenses claimed.

To determine who holds title to property for reimbursement purposes, you must verify:

(a) Whose name(s) actually appears on the title document (e.g., the deed); or

(b) Who holds equitable title interest in the property.

To determine if an employee holds equitable title interest in his/her property, you must follow the guidelines in §302–11.405.

No, you may not advance an employee funds for expenses incurred in connection with residence transactions.

The maximum amount that you may reimburse for the sale or purchase of an employee's residence is:

(a) Ten percent of the actual sale price for the sale of the employee's residence at the old official station; and

(b) Five percent of the actual purchase price of the residence for the purchase of a residence at the new official station.

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