Our bank is considering charging a "re-lock" fee to mortgage loan applicants who want to re-lock for a different interest rate or loan program. I believe this will be a finance charge. Agree or not? Thanks!

I agree. A fee to lock the rate is a prepaid finance charge. A fee to do it again would also be a prepaid finance charge. However you mentioned that the fee could also be for an applicant that wants to move to a different loan program. I'm not as sure about that one. You probably need to lay out some more facts regarding how it would work.

Terry, I think it's a prepaid, regardless. The fee is still directly related to the credit transaction, and I can't find anything in 226.4(c)(7) tht could even remotely cover switching to a new loan program.