We took a loan application to refi a house for $30,000 from another lender August 9

The borrower was going to make repairs to the property out of pocket, and anticipated closing the permanent loan in 6 months

The bank requested a “subject to” appraisal on the property in August 2013.

The “subject to” appraisal came in at $40,000

In September the borrower reported that he was thru with the repairs and would like to proceed with the permanent financing

An appraisal was ordered “as is” this appraisal came in at $56,000

The appraised value is not the issue. We needed and “as is” appraisal, per the loan officer.

My question is from a TIL perspective, can we exclude both appraisals from the prepaid finance charge? Or do I have to exclude one, which would cause the bank to absorb the cost? The appraisals cost $425 each.

My concern is, if we charge $850 for appraisals and the OCC review the loan, will they conclude that two appraisals for the property were excessive and therefore require one to be included as a PPFC, which will result in a reimbursable TIL situation.

The loan officer reported that the customer was fully supportive of the two appraisals and paying the fees. (I know htat mean nothing!!!!)

Just to make sure we understand what I am asking:

Loan Amt 32,076
PP FC 312
Appraisal 1 425
Appraisal 2 425

Amount Financed $30,914

Or 425
Amt Financed 31,339

Appraisals are never a finance charge in a real estate secured transaction regardless of how many are ordered.

I would say you have a real problem with one of the appraisals however. That is why too big of a gap to consider one of them a qualified appraisal.