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                               June 27, 1997
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                             GSBCA 13698-RELO


                      In the Matter of FLOYD L. CRAFT


     Floyd L. Craft, Newalla, OK, Claimant.

     Robert J. Young, General Law Section, Department of the Air
Force, Headquarters Sacramento Air Logistics Center (AFMC),
McClellan Air Force Base, CA, appearing for Department of Defense.

NEILL, Board Judge.

     Claimant in this case, Floyd L. Craft, is a civilian employee
of the United States Air Force.  He seeks reimbursement for certain
costs incurred in selling his residence on the occasion of a change
in duty stations.

     The Air Force, relying on provisions of the Department of
Defense Joint Travel Regulations (JTR) applicable to civilian
employees, has denied the request on the ground that the costs in
question are not customarily paid by the seller in the locality
where the transaction occurred.  We find that the costs in question
are in fact customarily paid with the type of financing used for
the purchase of claimant's residence.  We grant Mr. Craft's claim
in part.  


                                Background

     On January 26, 1996, Mr. Craft submitted a claim for $10,341
for expenses incurred in the sale of his home in Sacramento,
California.  He sold the house after being transferred from
McClellan Air Force Base, Sacramento, California, to Tinker Air
Force Base in Oklahoma.  The Air Force approved $7886 as
reimbursable under Chapter 14 of the JTR.  The remaining elements
of the claim were disallowed on the ground that they are ordinarily
paid by the buyer.  Mr. Craft asked that the agency reconsider its
ruling.  He then submitted a reclaim for a total of $2450. 
Included in this claim were the following items:
  
     $1100 loan origination fee;
     $  61 buyer's tax service; 
     $ 195 loan processing fee; 
     $ 299 loan document preparation fee;
     $ 300 buyer's title charge; 
     $ 350 loan appraisal fee;
     $  50 loan inspection fee; 
     $  60 credit report;
     $  35 wire fee to lender. 

     Claimant contended that his purchaser, in financing the
transaction, had used a "No-No" loan of the Veterans Administration
(VA), which for the purchaser involves no down-payment and no
closing costs.  

     The Air Force remained unconvinced by Mr. Craft's explanation. 
Nevertheless, on his behalf, Air Force officials forwarded their
determination to the General Accounting Office (GAO) for review. 
By letter dated March 20, 1996, Mr. Craft confirmed to GAO that he
wished that office to review the Air Force's denial of his claim. 
At the same time, he provided GAO with a copy of settlement
documentation showing that he had in fact paid the costs in
question.  The settlement sheet submitted also shows that all of
the items in question are lender and loan related charges.  This
includes the "buyer's title charge" which is shown on the
settlement sheet as being title insurance for the lender.  

     In his cover letter to GAO, Mr. Craft continued to contend
that use of the "VA No-No loan" is customary in the Sacramento
area.  This claim subsequently was transferred to this Board from
the GAO.
  





                                Discussion

     Chapter 14 of the JTR provides that when a permanent change of
station (PCS) is authorized, an employee will normally be entitled
to reimbursement for expenses paid in connection with the sale of
the employee's house at the old duty station.  One express
condition to reimbursement, however, is that the expenses be those
"customarily paid by the seller of a residence in the locality" of
the old permanent duty station.  JTR C14002-A.4.a.  

     In this case, the Air Force objects to paying the remaining
items in Mr. Craft's claim not because the amounts sought are
considered unreasonable but because it remains unconvinced that
there is a form of VA financing in which the seller customarily
pays all the purchaser's closing costs.  An agency representative
writes that he has had no success in finding a description of any
such VA program.  We find that the claimant's assertion is not
unique.  In other cases involving VA loans in other communities at
other times, the GAO held, based on information provided by the
Department of Housing and Urban Development (HUD), that where
property was being financed by a VA loan, it was customary for the
seller to pay the buyer's closing costs.  Edward M. Weglarz,
B-236362 (Nov. 9, 1989); James K. Lee, B-191402 (Nov. 22, 1978). 
Recently, this Board itself has recognized the practice and
concluded that sellers may be reimbursed for these costs if they
are otherwise reimbursable under applicable regulation.  Dawn S.
Daugherty, GSBCA 14065-RELO (June 5, 1997).  

     In our review of this claim, we have sought information from
the HUD office serving the Sacramento area.  That office has
provided us with information confirming Mr. Craft's assertions.  We
are told that the so-called VA "No-No" program is very popular
among veterans in the area and that when this type of financing is
used, the purchaser's closing costs are customarily paid by the
seller.  Having established this fact, however, we still must
examine the individual items for which Mr. Craft seeks
reimbursement to determine whether reimbursement is otherwise
appropriate under applicable regulation.

     The loan origination fee of $1100 and similar charges such as
$195 for loan processing and $299 for loan document preparation are
recoverable as miscellaneous expenses but not beyond one percent of
the loan amount without itemization of the lender's administrative
charges.  JTR C14002-A.4.a.2.  In the absence of more specific
itemization, Mr. Craft is entitled to no more than one percent of
the borrower's loan.  The principal amount of the loan in this case
is shown as $112,200.  Claimant, therefore, is entitled to $1122
for these items.  

     The buyer's tax service fee of $61 is not allowed.  The GAO 
held that this charge is part of a lender's finance charge.  Pamela
L. Swires, B-260724 (Sept. 21, 1995);  James A. Fairley, B-258932
(Sept. 19, 1995); George C. Souders, B-24845719 (Sept. 29, 1992). 
We agree with this conclusion and follow it here.  The charge,
therefore, is not reimbursable.  JTR C14002-A.4.b.5.  

     The $300 for title insurance for the lender is allowable (JTR
C14002.A.4.a.8), as are the charges of $60 for a credit report (JTR
C14002.A.4.a.3), $350 for the appraisal fee, $50 for the inspection
fee, and $35 for the wire fee to lender (JTR C14002.A.4.6.)  

     We grant Mr. Craft's claim in part.  The Air Force should
reimburse him for an additional $1917 for expenses paid by him in
the sale of his home in Sacramento, California.




                                   _____________________
                                   EDWIN B. NEILL
                                   Board Judge