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#1117723 - 01/27/09 09:57 PM pitfalls to loan exceptions
Trees Offline
Power Poster
Joined: Apr 2005
Posts: 4,013
if someone were to ask you why its not a good thing to have loan programs/policies and then make exceptions to those polices your answer would be.....?

I feel that a bank would be open to possible discrimination, probably unintentional.

Anyone have any other arguments against making exceptions, or have comments about this topic, please feel free.

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General Discussion
#1117763 - 01/28/09 01:16 AM Re: pitfalls to loan exceptions Trees
rlcarey Offline
10K Club
Joined: Jul 2001
Posts: 80,325
Galveston, TX
Policy are designed to ensure that the bank operates in a safe and sound manner. The board approves the policies and a high amount of exceptions without following the documentation standards for acceptable compensating factors (that should also be included by the Board) indicate disregard for the board approved policies.
The opinions expressed here should not be construed to be those of my employer:

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#1117811 - 01/28/09 06:22 AM Re: pitfalls to loan exceptions rlcarey
Dazed and Confused Offline
Gold Star
Dazed and Confused
Joined: Feb 2006
Posts: 250
Big XII South
A high level of exceptions could possibly indicate that the policy is too restrictive (i.e. committee approval required for small-dollar loans, etc.). But generally speaking ... I agree wtih RLC.

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#1118015 - 01/28/09 04:25 PM Re: pitfalls to loan exceptions Dazed and Confused
Mint Julep Offline
Diamond Poster
Mint Julep
Joined: Oct 2007
Posts: 1,152
Examiners will criticize an excessive number of exceptions to loan policy. They will also criticize if you are not tracking those exceptions.
Just another self-proclaimed expert ...

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#1118088 - 01/28/09 05:10 PM Re: pitfalls to loan exceptions Mint Julep
Trees Offline
Power Poster
Joined: Apr 2005
Posts: 4,013
We are tracking them and, so far, there aren't too many...

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