Answer by Jim Bedsole: Any fee or charge that is a finance charge will affect the APR on a closed end mortgage loan (fixed rate). For clarity on which fees or charges are a finance charge, study Reg Z section 226.4and the applicable staff commentary. These documents give a number of specific examples of fees that are and are not finance charges.
Answer by Richard Insley: Don't pay too much attention to the names of your fees. Look instead at the nature of each fee, the ultimate recipient, and and any upcharge. Apply the duck rule--if it looks like a FC, it's a FC, unless you can prove otherwise.
First published on BankersOnline.com 10/05/09