Document Preparation Fee Disclosure

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Question:

When charging a document preparation fee on a consumer loan is the fee disclosed as part of the finance charge and not added into the principal?

Answer:

Under Reg Z these fees would be a finance charge if the loan is not secured by real property. If secured by real property and the fees are bona fide and reasonable they would be excludable from the finance charge.

First published on BankersOnline.com 1/2/07