05/05/2003
We currently charge a service charge on every consumer loan in the amount of $50.00. The consumer loan manager wants to increase this fee to $75.00. It seems to me that I remember something about this fee having to be limited to $50.00.
05/05/2003
On a renewal of an existing loan using crops as collateral, a new security agreement is required. Is it necessary to file a new UCC? The UCC filed when the loan was originally done (along with the original security agreement) is good for 5 years, so why would it be necessary to file a new UCC every year even though a new security agreement is required every year?
04/21/2003
We will soon be launching a home improvement product for which we will be taking security interest in items that will likely become fixtures, i.e., windows, furnaces, etc. We will not be taking any traditional mortgage in connection with this product. Is the right of rescission triggered by taking such interests? Also, is there any concern with the application of federal flood regulations?
04/07/2003
Reg Z "Cash Out" refinance of existing residential first mortgage loan issue. A loan is closed on March 3, ROR expires on March 6 and loan is funded on March 7. Interest accrual on new loan begins on March 3. Question: Does the interest clock on the original (refinanced) loan stop on March 3 when the new loan was closed OR does it stop on March 7 when the loan was funded to pay off the old loan?
04/07/2003
We have a debate going on in our bank and would like some advice on the best course of action. Some are advocating that whenever a CD or savings account is pledged as collateral that is joint with right of survivorship, all owners of the deposit account must execute the assignment/pledge. Others are saying this is not feasible. The UCC for joint accounts seems to indicate that any party on a joint account can pledge it as security on a loan and other parties do not have recourse against the creditor IF the proper assignment or pledge has been used as the security instrument. The language is, however, ambiguous. There are definitely benefits to obtaining all account owners' signatures but it presents difficulty in obtaining them also.
04/01/2003
Bounce protection programs - those products put forward to banks as a significant generator of fee income - have come under the regulator's umbrella of concern.
03/03/2003
We are considering using a customers credit score to price their loan. (The credit scores we use come from the Credit Bureau.) With the theory that the lower the score the more risk involved. An example would be, New Auto Loan, credit score over 670, rate would be 7.49%; credit score between 620-670, rate 7.99%; and credit score less than 620, rate 8.49%. My question is are we OK pricing our consumer loans like this? Any pitfalls, reg violations?
02/17/2003
If the bank has a mortgage on a farm, and the mortgage states "That it secures future loans to the borrower"-how do the flood determination rules apply? For example, if the borrower comes in and takes out a 60-day single-pay note. Do we have to do a new flood determination or check the accuracy of the existing flood determination we did when the mortgage was established?
02/02/2003
If we lower the interest rate and change the note from a fixed rate to a variable rate mortgage, do RESPA and Reg Z apply? Does it matter if the collateral is a primary dwelling or just a second home?
02/02/2003
Can we charge a late fee on a farm loan secured by real estate?