Business and Personal Finance Dictionary

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• PREPAID FINANCE CHARGE
  
  Certain charges made in connection with the loan and which must be paid upon closing. The charges are defined by the Federal Reserve Board in Regulation Z and the charges must be paid by the borrower. Examples include, loan origination fees, points, PMI, and tax service fees. Prepaid finance charges are totaled and then subtracted from the Loan Amount. The net figure is the amount financed.
  
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