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Is the "Individual" a Consumer or a Business?
Answer by Dan Persfull and Richard Insley, BOL Gurus
Guru Bios
Question: How can we determine whether or not an individual is applying for a loan as a consumer or for business purposes? There is some ambiguity when it comes to investments. Are there any resources to help me with this?
Answer by Dan Persfull: Reg. Z's 226.3 and its Commentary gives you some tests to apply to the transaction as a guidance to whether the transaction is primarily business or consumer.
Answer by Richard Insley: A detailed purpose statement by the applicant is a good start. (Don't forget that Section 103.33(a) of the BSA Regs require you to obtain a purpose statement for non-R/E loans exceeding $10,000.)
First published on BankersOnline.com 5/05/08
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