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#1098464 - 12/17/08 01:48 PM HELOC
complyyes Offline
Member
Joined: Apr 2006
Posts: 51
Midwest
Change in terms to add a floor rate on existing HELOCs with rates at and below prime due to the recent government action of reducing fed funds to zero to .25? Anyone looking at this? Are you using Reg. Z - government action?

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Lending Compliance
#1098516 - 12/17/08 02:38 PM Re: HELOC complyyes
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 46,855
Bloomington, IN
The government only lowered Fed rates, they took no action to freeze, set or any other action to limit what you can or can not charge as an interest rate on your loans.

Unless your borrowers specifically agree to change their terms in writing you are obligated to honor the terms of the existing contract.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

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#1393156 - 05/19/10 02:54 AM Re: HELOC Dan Persfull
Jan94 Offline
Platinum Poster
Joined: Mar 2001
Posts: 828
USA
Would anyone have an example of how this would apply? What sort of "government action" would this include?

226.5b(f) Limitations on Home Equity Plans
7) government action prevents us from imposing the annual percentage rate provided for in the agreement, or impairs the priority of our security interest such that the value of the security interest is less than 120 percent of the credit limit on the line of credit.
Last edited by Jan94; 05/19/10 02:55 AM.
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