Unless I missed something, HUD doesn't really seem to have much to say as to why they don't want the abstractor fee listed as a separate item on the HUD 1.  But there is a discussion of the reasons for consolidation of settlement fees on the Good Faith Estimate (GFE).  One of the main points of these proposed rules has to do with the desire for a similar appearance between the GFE and THe HUD 1.  So, I guess the HUD 1 goes as does the GFE.

Here's part of the discussion, as presented by HUD.  There is no mention of title companies or VMs.  The lenders come out in favor of the separate line items in comments on the proposed 2002.  They are about the same as proposed today.  They just pretty much dusted off the 2002 proposed rules and tweaked them a little bit.  Here's (in part) what it says:

"In the 2002 Proposed Rule, HUD had proposed a GFE that grouped and consolidated charges into major cost catagories, with a single total amount for each catagory.  In commenting on the 2002 proposal, consumer groups were split on the best approach to addressing fee proliferation on the GFE.  AARP strongly supported consolidation of major cost catagories, and recommended that HUD's proposed catagories be further consolidated into three catagories for enhanced consumer comprehension.  The National consumer Law Center (NCLC) filed comments on its own behalf, and on behalf of [other consumer advocate groups].  These commenters noted that while subtotaling is helpful to consumers, itemization on the HUD 1 is necessary to ensure that compliance with TILA and the Home Ownership and Equity Protection Act (HOEPA) can be determined.  The National Community Reinvestment Coalition and the National Center on Poverty Law indicated their belief that the tolerance levels will address the issues of proliferation of fees, and commented that the GFE must be as similar as possible to the HUD 1 for comparison purposes.  Lenders who commented on this proposed change to the GFE in 2002 expressed concern that lumping costs together in large catagories will confuse consumers when they compare data on the GFE with data on the HUD 1/1A."

If HUD is giving it to us straight, I think it's the consumer advocates, and not the lenders or VMs, who are behind the banishment of the abstrac fee from the HUD 1.