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The Italian club, who had paid an initial loan fee to Chelsea, had an option in writing to extend the agreement for a further season ahead of a potential permanent transfer next summer, and duly exercised that clause by paying a further agreed fee.
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Instead, he said, his office sent letters threatening criminal charges unless the initial loan amounts plus fees were repaid.
Mr. Tobia says he expects many borrowers to continue with F.H.A. loans despite the higher fees, because of the low down payment and the ability to wrap the upfront insurance fee into the initial loan balance.
First, some lenders deduct an origination fee from the initial loan disbursement to keep it out of the APR.
And by the time borrowers get off this debt treadmill, they'll have paid much more in fees than their initial loan balance.
The Italian club quoted an exorbitant loan fee when Liverpool made their initial approach on Wednesday and rejected a proposal that the temporary deal could be terminated should Balotelli step out of line.
Egypt international Elmohamady joined Hull on an initial loan deal from Sunderland in 2012, before signing for £2m fee the following year.
In July, the Financial Conduct Authority said it was planning to limit interest on short term loans to 0.8% a day and cap the total fees and charges at 100% of the initial loan, starting from January.
In practice, many borrowers are unable to repay their initial loan in full within two weeks, and so they pay only the fees owed and roll over the balance into another payday loan, incurring another round of fees.
Loan fee, finder's fee, or similar charge.
Radamel Falcao - £6million loan fee from Monaco in September 2014.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com