Claim for Reimbursement of Loan Origination Fee Incident to Purchase of Home at New Location

An Authorized Certifying Officer requested an advanced decision as to the propriety of making payment on a claim by a Federal employee for certain real estate expenses incurred incident to his official change of station. Payment for a Loan Origination Fee had been disallowed because the empolyee did not have the required itemization of expenses making up that fee. The employee was unsuccessful in his attempt to secure the itemization from the lending institution. It was held that, under regulation, loan origination fees are finance charges under the regulation and therefore not reimburable. This is based on the rationale that a fee of this type without reference to the extent of services actually performed by the lender is more in the nature of a charge for the hire of money than it is a charge for the costs of customary services performed in the course of settlement and processing a loan. In the absence of specific, itemized information, it is not possible to separate reimbursable items from those which are nonreimbursable, or determine whether the charges for otherwise reimbursable items are reasonable. Accordingly, payment was not allowed.