Fees and Costs in Refinancings or Restructurings
12. If the terms of the new loan resulting from a loan refinancing or restructuring other than a
troubled debt restructuring are at least as favorable to the lender as the terms for comparable
loans to other customers with similar collection risks who are not refinancing or restructuring a
loan with the lender, the refinanced loan shall be accounted for as a new loan. This condition
would be met if the new loan's effective yield is at least equal to the effective yield for such
loans.4 Any unamortized net fees or costs and any prepayment penalties from the original loan
shall be recognized in interest income when the new loan is granted.

13. If the refinancing or restructuring does not meet the condition set forth in paragraph 12 or
if only minor modifications are made to the original loan contract, the unamortized net fees or
costs from the original loan and any prepayment penalties shall be carried forward as a part of
the net investment in the new loan. In this case, the investment in the new loan shall consist of
the remaining net investment in the original loan,5 any additional amounts loaned, any fees
received, and direct loan origination costs set forth in paragraph 6 associated with the
refinancing or restructuring.