Massachusetts Mass. Regs. Code tit. 209 § 32.04

(1) Definition. The finance charge is the cost of consumer credit as a dollar amount. It includes any charge payable directly or indirectly by the consumer and imposed directly or indirectly by the creditor as an incident to or a condition of the extension of credit. It does not include any charge of a type payable in a comparable cash transaction.

(2) Examples of Finance Charges. The finance charge includes the following types of charges, except for charges specifically excluded by 209 CAR 32.04(3) through (5):

(a) Interest, time price differential, and any amount payable under an add-on or discount system of additional charges.

(b) Service, transaction, activity, and carrying charges, including any charge imposed on a checking or other transaction account to the extent that the charge exceeds the charge for a similar account without a credit feature.

(c) Points, loan fees, assumption fees, finder's fees, and similar charges.

(d) Appraisal, investigation, and credit report fees.

(e) Premiums or other charges for any guarantee or insurance protecting the creditor against the consumer's default or other credit loss.

(f) Charges imposed on a creditor by another person for purchasing or accepting a consumer's obligation, if the consumer is required to pay the charges in cash, as an addition to the obligation, or as a deduction from the proceeds of the obligation.

(g) Premiums or other charges for credit life, accident, health, or loss-of-income insurance, written in connection with a credit transaction.

(h) Premiums or other charges for insurance against loss of or damage to property, or against liability arising out of the ownership or use of property, written in connection with a credit transaction.

(i) Discounts for the purpose of inducing payment by a means other than the use of credit.

(3) Charges Excluded from the Finance Charge. The following charges are not finance charges:

(a) Application fees charged to all applicants for credit, whether or not credit is actually extended.

(b) Charges for actual unanticipated late payment, for exceeding a credit limit, or for delinquency, default, or a similar occurrence.

(c) Charges imposed by a financial institution for paying items that overdraw an account, unless the payment of such items and the imposition of the charge were previously agreed upon in writing.

(d) Fees charged for participation in a credit plan, whether assessed on an annual or other periodic basis.

(e) Seller's points.

(f) Interest forfeited as a result of an interest reduction required by law on a time deposit used as a security for an extension of credit.

(g) The following fees in a transaction secured by real property or in a residential mortgage transaction, if the fees are bona fide and reasonable in amount:

1. Fees for title examination, abstract of title, title insurance, property survey, and similar purposes.

2. Fees for preparing deeds, mortgages, and reconveyance, settlement, and similar documents.

3. Notary, appraisal, and credit report fees.

4. Amounts required to be paid into escrow or trustee accounts if the amounts would not otherwise be included in the finance charge.

(h) Discounts offered to induce payment for a purchase by cash, check, or other means, as provided in M.G.L. c. 140D, § 28A(b).

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