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#154182 - 01/28/04 05:27 PM TIL Disclosure and Security Interest Charges
Anonymous
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In NYS, the cost of filing a UCC-1 has been increased significantly, so the bank wants to pass the charge onto the customer. The customer can pay the fee in cash, or add it to the loan amount.

What are the ramifications under REG Z? I believe this fee has to be disclosed to the customer in order for it NOT to be considered a finance charge. Is this correct?

Also, if it does have to be disclosed, I was planning on instructing everyone to disclose it in the FED Box under "Filing Fee". That way, it would be disclosed in a consistent manner, whether or not the fee was paid in cash, or added to the loan.

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#154183 - 01/28/04 07:32 PM Re: TIL Disclosure and Security Interest Charges
Dan Persfull Offline
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Dan Persfull
Joined: Aug 2002
Posts: 46,958
Bloomington, IN
From Reg. Z if the fee is disclosed properly it would be exempted from the finance charge (fees paid to public officials to perfect your lien). We disclose them as filing/recording fees. Not sure how NYS would consider the fee.
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The opinions expressed are mine and they are not to be taken as legal advice.

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#673686 - 01/26/07 08:14 PM Re: TIL Disclosure and Security Interest Charges Dan Persfull
Jan94 Offline
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Joined: Mar 2001
Posts: 828
USA
The bank makes a consumer real estate loan (closed-end) and all of the fees are paid in cash, however, the borrower gives the deed recording fee directly to the attorney at closing vs providing it to the bank since the bank does not file the deed for recording.

The bank is questioning whether this fee should be exempt from disclosing in the Fed Box "security interest charges" since the fee is paid directly to the attorney? We have a place in our fed box for these charges. I believe that since the recording of the deed is required by the bank to perfect the lien that the fee would be shown in our fed box regardless to whom it was paid. I'm reading 226.4(e) and 226.18(o) and it doesn't appear to make a difference. Am I overlooking something? Thank you.

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#673725 - 01/26/07 08:30 PM Re: TIL Disclosure and Security Interest Charges Jan94
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 46,958
Bloomington, IN
I would agree. The fee is still being paid to a public official to perfect your lien whether they are paying it through you or the attorney.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

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