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We are working with borrowers who are obtaining mortgages from the Illinois Housing Development Authority (IHDA) as well as from our bank. The two mortgages will be closed with the same title company at the same time. They will be separate mortgages, with significantly different terms. We are including in our disclosures the recording fees for both our mortgage and IHDA’s mortgage. We know that we can exclude our bank’s recording fee from the finance charge calculation. But can we exclude the IHDA recording fee? – IBA Compliance Connection

IBA Compliance Connection

Your go to source for compliance!

We are working with borrowers who are obtaining mortgages from the Illinois Housing Development Authority (IHDA) as well as from our bank. The two mortgages will be closed with the same title company at the same time. They will be separate mortgages, with significantly different terms. We are including in our disclosures the recording fees for both our mortgage and IHDA’s mortgage. We know that we can exclude our bank’s recording fee from the finance charge calculation. But can we exclude the IHDA recording fee?

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In our view, fees related to IHDA’s loan should be disclosed only on IHDA’s loan disclosures. We recommend removing IHDA’s fee for recording their lien from your disclosures, which will definitively remove the fee from your finance charge calculation.