A mortgage broker charges a borrower a $500 processing fee and receives a $2,000 yield spread premium from the lender. For TILA disclosure purposes, what amount should be included in the finance charge?
Correct Answer
A) $500 only
Under Regulation Z, yield spread premiums paid by lenders to brokers are not considered finance charges to the borrower. Only fees paid directly by the borrower, like the $500 processing fee, are included in the finance charge calculation.
Why This Is the Correct Answer
Under Regulation Z, yield spread premiums paid by lenders to brokers are not considered finance charges to the borrower. Only fees paid directly by the borrower, like the $500 processing fee, are included in the finance charge calculation.
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Which of the following fees would NOT be included in the points and fees calculation for HOEPA purposes on a $150,000 loan?
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