The High Cost rule says points and fees cannot be financed into the loan amount. So does this mean the customer has to pay the point or for example: an origination fee in cash at closing in order to get their loan??????????

Thanks, Kim

Yes, that is exactly what it means.

yikes!!!! thanks for your help...

Is this for only loans that are considered high cost? If a loan is NOT high cost, can the points and fees still be financed?

That's my understanding...

The prohibition of financing points and fees under [§1026.34(a)(10)] only applies to high cost mortgage loans.

High cost being HOEPA not just HPML?

It applies to loans that are high cost mortgage loans under section 1026.32 (sometimes referred to as HOEPA loans). If high cost mortgage status is triggered by the section 32 rate or point triggers, points and fees can't be financed. A high cost mortgage loan can also be an HPML, in which case the prohibition on financing points and fees would still apply because of the HCML status.