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#1731479 - 08/15/12 10:26 PM Heloc Disclosures
Jodi Offline
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Jodi
Joined: Jun 2002
Posts: 87
For Heloc loans, are grantors supposed to receive a copy of the Early Disclosure and a copy of Credit Agreement and Disclosure? It is pretty vague in Reg Z. Thank you

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#1731546 - 08/16/12 12:37 PM Re: Heloc Disclosures Jodi
RR Joker Offline
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RR Joker
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Posts: 20,654
The Swamp
No.


ETA: I'm assuming you mean guarantors.
Last edited by RR Joker; 08/16/12 12:38 PM.
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#1731606 - 08/16/12 02:06 PM Re: Heloc Disclosures Jodi
Dan Persfull Offline
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Dan Persfull
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Bloomington, IN
If the grantor's (person granting a security interest) primary dwelling is securing the loan then they must receive copies of all material disclosures. The material disclosures for HELOCs are defined in 1026.15.
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The opinions expressed are mine and they are not to be taken as legal advice.

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#1732327 - 08/17/12 04:03 PM Re: Heloc Disclosures Dan Persfull
Jodi Offline
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Jodi
Joined: Jun 2002
Posts: 87
This is the explanation/definition of material disclosures from the Interpretation of section 1026.15 Reg Z:
3. Material disclosures—variable rate program. For a variable rate program, the material disclosures also include the disclosures listed in §1026.6(a)(1)(ii): the circumstances under which the rate may increase; the limitations on the increase; and the effect of an increase. The disclosures listed in §1026.6(a)(1)(ii) for any repayment phase also are material disclosures for variable-rate programs.

So, since 1026.6 (a)(1)(ii) is A disclosure of each periodic rate that may be used to compute the finance charge, the range of balances...

To me you do have to give the GRANTOR the Early Heloc Disclosure. Right or Wrong?

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#1733001 - 08/20/12 10:50 PM Re: Heloc Disclosures RR Joker
Jodi Offline
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Jodi
Joined: Jun 2002
Posts: 87
Hey ~ would anyone care to comment? Thanks

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#1733067 - 08/21/12 01:03 PM Re: Heloc Disclosures Jodi
Dan Persfull Offline
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Dan Persfull
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Bloomington, IN
Go back to the section in the Commentary just above the one you posted.

2. Material disclosures. Section 1026.15(a)(3) sets forth the material disclosures that must be provided before the rescission period can begin to run. The creditor must provide sufficient information to satisfy the requirements of §1026.6 for these disclosures. A creditor may satisfy this requirement by giving an initial disclosure statement that complies with the regulation. Failure to give the other required initial disclosures (such as the billing rights statement) or the information required under §1026.40 does not prevent the running of the rescission period, although that failure may result in civil liability or administrative sanctions. The payment terms set forth in §1026.15(a)(3) apply to any repayment phase set forth in the agreement. Thus, the payment terms described in §1026.6(e)(2) for any repayment phase as well as for the draw period are “material disclosures.”

The HELOC Plan Disclosure is not a material disclosure for the purposes of rescission.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

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