Inclusion Of Attorney's Fees In Calculating The Annual Percentage Rate - Q1 1999

By the Division of Banks

It has been the consistent position of the Division that attorney's fees as listed in 209 CMR 32.04(3)(g)1 through 5, in a transaction secured by a residential mortgage, if bona fide and reasonable in amount, are specifically excluded from the finance charge and, therefore, from the calculation of the annual percentage rate. However, in the event that an attorney charges a fee for a service which is not excluded from this section, then the amount of the fee would be considered a finance charge and included in the A.P.R.