Which fee is NOT included in the zero tolerance category?

The correct answer is that the fee not included in the zero tolerance category is third-party service fees. In the context of the Real Estate Settlement Procedures Act (RESPA), zero tolerance fees are those that cannot change at all between the Loan Estimate provided to the borrower and the final closing disclosure. Transfer taxes, origination fees, and lender fees are all categorized under zero tolerance, meaning they must remain consistent.

Third-party service fees, however, are subject to what’s known as a 10% tolerance. This means that while they can increase, the total of such fees can only rise by 10% from the initial estimate provided to the borrower. This distinction is fundamental, as it helps borrowers understand which costs are potentially subject to variation and which are locked in, thereby protecting them from unexpected increases in costs at closing.