Specific Issues for Comment:

Specific Issues for Comment:
Lucy Griffin, Editor, Compliance Action and BOL Guru

We've listed specific issues for comment on the proposed amendments to Regulation C. Choose the issues that most concern you and common upon those.

• Compiling and reporting additional data
  The proposal would require the collection and reporting of additional information:
  -The APR
  -Whether the loan is subject to the special rules in HOEPA status
  -Whether the loan is secured by a manufactured home
  -How will this additional information be collected in your bank?
  -When does this information, such as the APR or HOEPA status, become available?
  -Will this change who, when, and how your bank compiles the LAR?
  -Describe any problems you anticipate in this reporting change.
  
  
• Simplification of the definition of a "refinancing.
  -Does the proposed definition accomplish what is intended?
  -Is the proposed definition appropriate?
  -Does this definition fit well with the lending responsibilities and activities in your bank?
  -Is there an approach that would be easier/less burdensome to implement?
  
  
• The Proposal would use three categories: purchase, refinancing, and home improvement.
  -Will these categories be easy to implement in your bank?
  -Will the information be meaningful?
  -Is there a useful or informative difference between refinance and home improvement loans?
  -Is there a better/easier way to identify the type of loan?
  
  
• Reporting pre-approvals
  The FRB staff believes that the definition is narrowly drawn and should mitigate burden caused by the change:
  "under procedures in which a financial institution issues to creditworthy persons a written commitment for a home purchase loan up to a specific amount that is valid for a designated period of time, even if issued subject to the identification of property or other conditions."
  
  -This is different from the concept of preapproval in Regulation B. Is this a concern?
  -Should the definition include adverse action decisions? Should these also be reported?
  -Is this sufficiently specific to identify reportable preapprovals?
  -Can this be implemented with a high level of accuracy?
  -What is the bright line between a pre-approval and the usual exchanges with customers?
  -What will be consequences for error?
  
  
• Simplifying the definition of a home improvement loan.
  This will require every loan application taker to ask the customer's whether the customer intends to use any of the proceeds for home improvement. If this is not the primary purpose of the loan, customer responses may not be reliable.
  
  -Explain the number of ways that a home improvement loan application could be taken in your bank.
  -Explain the number of ways that a home improvement loan could be > -Provide an estimate of the number of additional loans that would be reported.
  
  
• Requiring reporting of home equity lines of credit
  State the number of home equity applications your bank received in the most recent calendar year. State the number of loans made.
  -If you have information on the number of line increases, provide that.
  -Estimate the proportion of lines that are used for home-related purposes.
  -Estimate how many lines of credit are made for business purposes.
  
  
• Expanding the coverage to non-depository lenders.
  -The proposal would include lenders that originate more than $50 million in mortgage loans in a calendar year or originated at least 100 loans in the calendar year.
  -State whether this would affect any non-depository lenders in your market, and if so, how many.
  -State whether this will provide any useful information on predatory and sub-prime lending.
  
  How to Comment
  Sample Reg C Comment Letter
  
  
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