My bank wants to charge a pre-payment penalty on a fixed rate loan. We do these as one closing.

The regulation says that the construction phase is exempt from the rules. Does that mean we could charge a pre-payment penalty if paid off before it goes permanent without having to offer an alternative loan that does not have the penalty?

If it goes permanent, we could charge a pre-payment penalty as long as it is not an HPML and the penalty meets the 36 month "percentage" rules and we offer an alternative no penalty program?

Would the pre-payment penalty then be part of the points and fees calculations for a higher priced mortgage?