(a) In addition to any other charges permitted for the advance of money or for the extension of credit, a lender or seller may collect a closing fee at the time of making a loan or extending credit in order to defray the costs of investigation and verification of a borrower's or purchaser's credit reports and references. Such closing fee may be for an amount up to 4 percent of the face amount of the loan or credit extension or total amount of the sales contract but shall not be more than $50.00. Such closing fee may be paid from the proceeds of the amount borrowed or added to the principal amount of the loan or credit extension.

(b) When any loan or sales contract upon which a closing fee has been charged is prepaid in full by any means within 90 days of the date of the loan or sales contract, the lender or seller shall refund or credit the borrower or purchaser with a pro rata portion of the closing fee; provided, however, that in such event, the lender or seller may retain an amount of not more than $25.00 from the collected closing fee.

(c) This Code section shall only apply to industrial loans made pursuant to Chapter 3 of Title 7, retail installment and home solicitation sales contracts entered into pursuant to Article 1 of Chapter 1 of Title 10, and insurance premium finance agreements entered into pursuant to Chapter 22 of Title 33; provided, however, that a closing fee authorized under this Code section shall not constitute interest, a time price differential, a finance charge, or a service charge within the meaning of Code Section 7-3-15, 10-1-4, or 33-22-9.

(d) Nothing contained in Code Section 7-4-18 shall be construed to amend or modify the provisions of this Code section.