QUESTION
Can a lender charge a non-refundable processing fee? How?
Asked on Jun 09th, 2015 on Bankruptcy - Michigan
More details to this question:
Can a processing fee be non-refundable if the loan doesn't pass underwriting or is otherwise turned down?
7 ANSWERS
That would be a yes.
Answered on Aug 28th, 2015 at 8:12 PM
Commercial & Bankruptcy Law Attorney serving Powell, OH
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Ronald K. Nims
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Yes, lenders can charge an "application fee" which is nonrefundable if the loan doesn't go through. Any money that you have to pay upfront is probably nonrefundable. These charges used to be automatic and every lender charged them, but with the increased competition due to the internet, they are rare today. If you contact a lender that wants an upfront fee, go to another lender. If Obama succeeds in his attempt to regulate the internet, application fees will become common again.
Answered on Jul 27th, 2015 at 2:59 PM
Bankruptcy Attorney serving Livonia, MI
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Charles J. Schneider, P.C.
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If it is your contract. Yes.
Answered on Jul 27th, 2015 at 2:59 PM
Debt Collection Attorney serving Chicago, IL
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Edelman, Combs, Latturner & Goodwin, LLC
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Application fees for processing and evaluating loans are not uncommon.
Answered on Jul 27th, 2015 at 2:59 PM
Appellate Attorney serving Grosse Pointe Farms, MI
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Musilli Brennan Associates, PLLC
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It all depends upon what it is that you agree to, but it certainly possible to have a nonrefundable processing fee.
Answered on Jul 27th, 2015 at 2:59 PM
Bankruptcy Attorney serving Madison, WI
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Richard B. Jacobson & Associates, LLC
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I believe it can. After all, it did 'process' the loan; it just did not approve it. Good Luck.
Answered on Jul 27th, 2015 at 2:59 PM
As a general rule, lenders can charge whatever they want in fees unless a state law prohibits it. The reason for these fees is often because the lender must spend money on credit reports, commissions and other expenses to investigate potential borrowers.
Answered on Jul 27th, 2015 at 2:59 PM