Friday, December 12, 2008

What Does POC Mean?

Here's another common question:

Q: What does POC mean on a final settlement statement?

A: POC stands for Paid Outside of Closing, and refers to any fee that is not being disbursed at the closing. The two most common POC charges are the appraisal fee (if it has been paid by the borrower before the closing) and the yield spread premium (the rebate that the lender pays the mortgage broker).

If a fee is marked as POC, it is not included in the bottom line on the settlement statement because the borrower has either already paid it (in the case of a paid appraisal) or the borrower does not owe it (in the case of a yield spread premium).

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