Truth in Lending: 3.6.1.2 Treatment of a “Credit” from the Creditor or Other Party to the Consumer
Particularly in home-secured loans, the creditor may offset the closing costs in part by a credit, often in exchange for a higher interest rate. Some lenders pay a credit to the consumer instead of paying a yield spread premium to a broker87 The payment of a credit may mask a broker upcharge even though the credit is applied against closing costs generally.