True or False: If a charge is reasonable and not compensated by the creditor, it may be excluded from points and fees.

The statement is true because when determining points and fees under the Truth in Lending Act (Regulation Z), charges that are reasonable and not compensated by the creditor can be excluded from the total calculation of points and fees. This is designed to ensure that only costs which directly burden the consumer are included, while legitimate charges that do not lead to profit for the creditor can be omitted. This exclusion is typically intended to protect consumers from excessive charges, allowing for a clearer understanding of the effective cost of credit.

The other answer options introduce conditions that are not applicable in this context. There is no requirement for proper disclosure for a charge to be excluded if it is deemed reasonable and uncompensated, nor are there limitations that restrict this exclusion to specific situations. The correctness of the answer underscores the regulatory intent to clarify consumer costs associated with borrowing without including all reasonable fees.