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#1240588 - 08/27/09 07:56 PM Getting more gray hair over Reg Z
WHEDA Offline
100 Club
WHEDA
Joined: Apr 2009
Posts: 189
Wisconsin
On a closed-end subordinate lien home improvement loan (fixed amount, rate & term, & single disbursement) where costs (credit report, title search, recording fees, flood plain determination) are paid from loan proceeds, and some of those costs are considered a PPFC (recording fee for Assignment to investor, post-closing inspection & life-of-loan flood cert coverage), is the APR calc based on the gross Note amount or net of the costs paid from loan proceeds?

Thank you for your help.

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Lending Compliance
#1240601 - 08/27/09 08:09 PM Re: Getting more gray hair over Reg Z WHEDA
David Dickinson Offline
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David Dickinson
Joined: Nov 2000
Posts: 18,762
Central City, NE
I'm not sure I fully understand your questions, so help me out if I'm not completely answering your questions:

CR (for RE secured loans), title search and recording fees are not a FC (or PPFC) if they are bona fide and reasonable.

A post-closing inspection and LOL flood is a PPFC.

The APR is a calculation of the Amount Financed (Gross loan amount less PPFCs)
_________________________
David Dickinson
http://www.bankerscompliance.com

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#1240730 - 08/27/09 09:15 PM Re: Getting more gray hair over Reg Z David Dickinson
WHEDA Offline
100 Club
WHEDA
Joined: Apr 2009
Posts: 189
Wisconsin
Your response makes perfect sense.

Thank you.

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