1151.51 Accounting procedure in certain transactions.

All expenses of a building and loan association shall be paid out of its gross earnings only, and so much of such earnings as is necessary must be set aside each year for such purpose. If the association acquires real estate as a result of default in a mortgage, whether by deed or by foreclosure, amounts paid out by it in court costs and taxes at the time such real estate is acquired may be charged to a reserve fund, and reconditioning costs after such real estate is acquired may be charged either to a reserve fund or to current operating expense, as determined by the board of directors. When any parcel of such real estate is sold by the association, the funds received shall be applied to the payment of sales expense, to the restoration of losses previously charged to the reserve or undivided profit funds, to the reduction of the book value of such real estate, or to current income, as determined by the board. The association may levy a reasonable charge, upon any corporation or person applying for a mortgage loan for which such real estate is given as security, for any services by it in connection with the loan or for extending the period of maturity of the loan or otherwise readjusting or refinancing it and for any other action by the association permitted or required by law with respect to such loans. All such charges, except reasonable attorneys' fees and charges for legal services and reasonable appraisal fees, must be made by the association directly and accounted for on its books. A reasonable appraisal fee may be charged by the association, and shall be paid by the borrower to the association prior to or subsequent to the granting of a loan.

Upon the closing of the loan, the association shall, directly or through its attorney, furnish the borrower a loan settlement statement showing in detail all charges and fees the borrower has paid or obligated himself to pay either to the association or to its attorney in connection with such loan; and a copy of such loan settlement statement shall be retained in the records of the association.

Cite as R.C. § 1151.51

History. Effective Date: 08-09-1963