11/11/2002
We do not want to make any highcost home loans under any state laws or under HOEPA. If we do a rate and fees test during the processing of a loan application and determine that it does meet a highcost loan test, can we deny a loan on the basis that we do not want to make a loan that is subject to HOEPA or other highcost home loan restrictions or must we lower our rate and/or fees to avoid coverage?
08/05/2002
For HMDA reporting: If I have a commercial loan/business purpose where the applicant is a natural person, should I answer N/A for monitoring information, or am I obligated to complete the motioring info in the form based on observation. (The commercial loan application does not provide for collecting the government monitoring.
08/01/2002
The Federal Reserve Board has issued final HMDA rules for 2003 and for 2004. The expanded and much more complicated Loan Application Register ("LAR") comes into use at the beginning of 2004.
07/15/2002
Our Consumer Lending unit received the following response to a recent audit. "According to the regulation, a bank may pull a credit report on a person if they have a permissible purpose. An application for credit is considered a permissible purpose. When the Contact Centers take applications over the telephone (he doesnt mention anything about the Internet) they are only speaking with one of the applicants, but if the application is joint, credit bureaus aer obtained for both applicants. Without talking to the joint applicant, the bank can not be sure that the second individuaal is aware of, or wants to apply for a loan. If a co-applicant does not want to be an applicant on the loan, the Bank would not have a permissible purpose for obtaining the credit bureau. It is recommended that the Consumer Lending Dept require that all parties on a loan application be made aware that a credit bureau will be obtained." I realize that this is only a recommendation, but this team believes because a compliance auditor wrote this, they need to act on this recommendation. Is there some litigation that suggests we need to do this? I simply can not find anything, anywhere that states we are required to verbally inform a co-app that we are going to pull a cbr. What am I missing here? Is this a business decision and if so, based on what? If its written somewhere, I would like to see it. What are other institutions doing?
07/01/2002
Is there a simplified summary of the current, pending HOEPA changes/regulations, pertinent to a mortgage nondepository lender?
05/08/2002
03/04/2002
How can I better protect my bank clients? As an inbound call center we receive calls from prospective borrowers. The prospects are responding to directmail inviting them to apply for a loan. Prior to the telephone call all prospect information is from a public source. During the call the prospective borrower is asked to complete a loan application. The application is designed to prequalify the borrower. Our duties cease when we transfer that information to our client, the bank. All other communication and correspondence is handled by the bank or by other partners. 1. Do we meet the definition as an "outside service?" 2. Should we modify our current confidentiality agreements with employees to stress or include specific language? 3. Once the data is captured, is it by definition "nonpublic" information?
03/04/2002
If a bank requires an upfront deposit on a mortgage loan application for appraisal and credit report fee costs, is this considered an application fee that must be charged to all applicants even if the application is declined prior to incurring the charges? Reg Z seems contradictory on this issue since appraisal and credit report fees are generally not to be considered finance charges in a real estate transaction.
03/01/2002
Compliance is scattered across a lot of regulations. There are Reg Z and RESPA governing when and how to give applicants information about a loan.
02/01/2002
After several years of regulatory review and one year of dealing with special predatory lending considerations, the Board of Governors of the Federal Reserve System has issued changes to HMDA's Reg