Is a tax monitoring fee a pre-paid finance charge? - David Dickinson

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Is a tax monitoring fee a pre-paid finance charge?
by Andy Zavoina, BOL Guru
BIO AND CONTACT INFO

Question: Our institution would like to charge a one-time $ 75 fee to our mortgage customers for our service of monitoring whether or not their property taxes are paid over the life of their loan. Is this a pre-paid finance charge? Are there other compliance issues we should be addressing?

Answer: This is a prepaid finance charge similar to life of loan flood monitoring. List this fee in the 800 section of the HUD-1/1A.

First published on BankersOnline.com 8/18/03

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