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August 5, 2015
HMDA – Beyond the Input
Patricia Cashman

August 11, 2015
ABCs of HSAs
Whitney Johnson

August 12, 2015
Part I: Flood Insurance - Everything You Need To Know (including June 2015 Rules)
David Dickinson and Jerod Moyer

August 13, 2015
Currency Transaction Report (CTR): Line-By-Line for Tellers
Deborah Crawford

August 18, 2015
Disaster Recovery Revisited: 5 Things You May Not Have Considered (for a while)
David Reed

August 20, 2015
Automated Monitoring Systems: Implementation to Validation
Brian Crow

August 25, 2015
MasterCard & Reg E Error Resolution
Brian Crow



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#864891 - 12/03/07 12:07 PM RESPA Section 8 Violations?
MyScamper Offline
Gold Star

Registered: 05/04/06
Posts: 447
Loc: Between here and there
Any opinions on whether or not the following examples would be violations of Section 8 of RESPA?

1) Borrower closes loan with the mortgage division and at closing is given a coupon worth $50 if he/she refers another borrower to the bank and the loan closes ($50 is paid when the referred loan closes).
2) Coupons worth $50 are sent out to deposit customers and are redeemable

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Lending Compliance
#864903 - 12/03/07 12:17 PM Re: RESPA Section 8 Violations? [Re: MyScamper]
GuitarDude Offline
Power Poster

Registered: 11/17/04
Posts: 5697
Loc: So Cal
Yes and yes.
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#864914 - 12/03/07 12:23 PM Re: RESPA Section 8 Violations? [Re: GuitarDude]
MyScamper Offline
Gold Star

Registered: 05/04/06
Posts: 447
Loc: Between here and there
Can you point me to the part of the reg that would specifically prohibit this? We are thinking that since the coupon is not going to someone who provides a settlement service it is OK.

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#864983 - 12/03/07 01:24 PM Re: RESPA Section 8 Violations? [Re: MyScamper]
GuitarDude Offline
Power Poster

Registered: 11/17/04
Posts: 5697
Loc: So Cal
Reg X section 3500.14 prohibits the payment of a fee for the referral of a settlement service. The definition of a settlement service in 3500.2 includes the origination of a federally-related mortgage loan. "Origination" includes the taking, processing and underwriting of an application.
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#864994 - 12/03/07 01:37 PM Re: RESPA Section 8 Violations? [Re: GuitarDude]
RR Joker Offline
10K Club

Registered: 11/15/02
Posts: 17039
Loc: The Swamp
1) yes
2) no...at least not at face value...what is the coupon for for these deposit account holders? Is it a "bonus", "gift" or what? YOu would need to review Reg D/Q and make sure you are not violating anything within that section, however.
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My opinion only. Not legal advice.

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#865013 - 12/03/07 02:03 PM Re: RESPA Section 8 Violations? [Re: RR Joker]
GuitarDude Offline
Power Poster

Registered: 11/17/04
Posts: 5697
Loc: So Cal
I was assuming that the "coupons" in example #2 were for the referral of mortgage applicants. If that is the case, this would be a prohibited referral fee even though the coupon adds an extra step, IMO.

Scamper, what would be the circumstances in which the deposit customer would receive the coupon?
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I've just writed a wrong.

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#865032 - 12/03/07 02:15 PM Re: RESPA Section 8 Violations? [Re: GuitarDude]
MyScamper Offline
Gold Star

Registered: 05/04/06
Posts: 447
Loc: Between here and there
The coupon for deposit customers would be part of a marketing mailing. Tell a friend about us and if they close a mortgage with us, redeem the coupon for $50.00.

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#865035 - 12/03/07 02:16 PM Re: RESPA Section 8 Violations? [Re: MyScamper]
RR Joker Offline
10K Club

Registered: 11/15/02
Posts: 17039
Loc: The Swamp
I'd stay far away from that one!
_________________________
My opinion only. Not legal advice.

Say you'll haunt me - Stone Sour

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#865091 - 12/03/07 02:57 PM Re: RESPA Section 8 Violations? [Re: RR Joker]
TB 12 Online
Power Poster

Registered: 02/07/05
Posts: 6529
Loc: Foxboro
we talked about a similar program scamper, and along with the issues brought up by others already, we had privacy concerns. Say your customer Ms. Jones refers Mr. Smith, and Mr. Smith gets denied. Ms. Jones calls asking for her referral fee...we certainly can't give her the loan status for Mr. Smith...
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#865148 - 12/03/07 03:37 PM Re: RESPA Section 8 Violations? [Re: TB 12]
RR Joker Offline
10K Club

Registered: 11/15/02
Posts: 17039
Loc: The Swamp
or technically, even the fact that if you DO make the loan...Ms. Jones will now know Mr. Smith is a customer.
_________________________
My opinion only. Not legal advice.

Say you'll haunt me - Stone Sour

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#865314 - 12/03/07 05:49 PM Re: RESPA Section 8 Violations? [Re: MyScamper]
David Dickinson Online
10K Club

Registered: 11/28/00
Posts: 14913
Loc: Central City, NE
Originally Posted By: MyScamper
The coupon for deposit customers would be part of a marketing mailing. Tell a friend about us and if they close a mortgage with us, redeem the coupon for $50.00.

This is definitely a Section 8 issue, as Guitar Dude assumed.
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David Dickinson
http://www.bankerscompliance.com

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