Client purchased several rental houses during 2006 and provided copies of the settlement statements for each property purchased. I plan to capitalize points and loan origination fees over the life of the loan. However, how should I deduct other closing costs such as appraisal fees, credit reports, tax service fees, flood checks, underwriting fee, lender closing fee, processing fees and broker courier fees? How about court house recording fees and title insurance costs? Should these items be expensed in 2006 or capitalized over the term of the loan similar to the point and loan origination fees? Thanks.
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