Is This Fee a Finance Charge? - Dan Persfull

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Is This Fee a Finance Charge?
by Dan Persfull, BOL Gurus
Guru BIOS

Question: Is a fee collected for the preparation of extension/modification documents on a consumer non-real estate loan a fee to be included in the APR?

Answer: I know this sounds like a stuck record, but check your state laws dealing with extension/deferral and modification fees.

From a Reg. Z perspective, extensions/modifications are not refinancings and do not require redisclosure. These fees are subsequent charges and would not be a finance charge, in my opinion.

First published on BankersOnline.com 3/7/05

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