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We currently allow customers to finance their HELOC closing costs with a first draw against the loan. We have recently switched our core system and are double checking the statement setup. We use 1026.7(b) when producing the first statement.
In the past we have itemized all the fees under “Activity” and also listed any fees considered finance charge (processing, and flood LOL) under a separate section titled “Fees”. The fees section is then totaled for period and YTD.The current system does not break out the finance charge related fees or total them. We are setting up the fees to be listed correctly and totaled but have had some questions if only the finance charge fees should be included or all fees should be included.
Under 7(a) the term “other charges” (1026.7(a)(6)(ii)) would seem to state these non-finance charge fees would not need to be listed or totaled. But since we are using 7(b) can we even use this section of 7(a)?
It does state “Creditors may comply with paragraphs (a)(6) of this section, or with paragraph (b)(6) of this section, at their option.”It appears we did part 7(a) and part 7(b) in the past, but that doesn’t mean it was correct. 🙂
So…. were we doing it correct in the past… or should all fees (FC related or not) be under the fees section and in the period and YTD totals.
Additionally, if they are under the fees section, do they still need to be listed under the activity section?Thank you for your help
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