Currently our practice is to either finance the fee's into the initial draw or collect the fee's in cash....
If we finance them, the system (Fiserv Navigator) will pool all of the fee's (including the NON finance charge fees) into the finance charge disclosed on the initial periodic statement. The statement will itemize each fee with it's correct title (Loan processing, credit report, appraisal, recording, etc)in the top section of the statement, but it does not differentiate the charges that should be included in the APR with the fee's that should not be included. They are all disclosed under the Total Finance Charges section. They all end up affecting the APR, as a finance charge when in fact they are not all finance charges.

Approx one year ago in a previous world I was instructed by consultants that this was not permissable and we then collected all fees in cash from the customer, they were not allowed to finance them any long.

Would you not see this same situation here?


PLEASE HELP!

7(a)(6)(ii) Other Charges

1. Identification. In identifying any other charges actually imposed during the billing cycle, the type is adequately described as late charge or membership fee, for example. Similarly, closing costs or settlement costs, for example, may be used to describe charges imposed in connection with real estate transactions that are excluded from the finance charge under §1026.4(c)(7), if the same term (such as closing costs ) was used in the initial disclosures and if the creditor chose to itemize and individually disclose the costs included in that term. Even though the taxes and filing or notary fees excluded from the finance charge under §1026.4(e) are not required to be disclosed as other charges under §1026.6(a)(2), these charges may be included in the amount shown as closing costs or settlement costs on the periodic statement, if the charges were itemized and disclosed as part of the closing costs or settlement costs on the initial disclosure statement. ( See comment 6(a)(2)–1 for examples of other charges.)

So in other words we are ok to show closing fees as a finance charge on the periodic statement as we did itemize the costs on the initial statement as welll.
THANK YOU!