Claim for Real Estate Expenses Involving Loan Assumption Fee

B-197544: Jul 10, 1980

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The certifying officer of an agency requested a determination regarding the propriety of certifying for payment a reclaim voucher for an employee which represented a loan assumption fee incurred in connection with the purchase of a home incident to relocation. The agency denied the loan assumption fee as a cost incident to the extension of credit and therefore a nonreimburseable finance charge under the regulations. The employee claimed the agency action was improper as the fee was for the preparation of documents and did not represent a finance charge. GAO did not find the fee covered charges which are excludable from the finance charge thus the reclaim for reimbursement of the loan assumption fee may not be certified for payment.