We have a customer that builds cabins and homes then sells them. He would like to put "Special Financing by ________Bank".
on his banner. Is there any compliance issues that we need to worry about?
Thanks for the input.

Are you paying a share of the advertising costs for producing the banner? If not, your inclusion in the advertising could be deemed to be a thing of value. If that thing of value is being given by the builder in exchange for you doing special financing that could be a RESPA Section 8 problem.

The bank would not be paying anything.

That's sort of my point. You are getting something of value - namely free publicity. In exchange for that free publicity you are providing special financing. That is a violation of RESPA Section 8 provisions which prohibits kickbacks and unearned fees. Section 8 stipulates that it is illegal to give or to receive a thing of value in exchange for the referral of settlement service business (which includes making housing loans).

So if the bank helps pay for the banner, and the housing and FDIC logo is put on there, would that cover it?
Marketing makes me crazy!

"In exchange for that free publicity you are providing special financing. That is a violation of RESPA Section 8 provisions which prohibits kickbacks and unearned fees."

Isn't the benefit going to the borrower though????

I don't know. I don't know what the terms of the "special financing" are. I'm only thinking from the aspect that the builder needs his buyers to have financing. As part of the arrangement to have the bank be a ready source of financing, the builder provides free publicity for the bank. That to me says potential RESPA problem. I just think it needs more work and documentation. Certainly, the bank paying it's share of the marketing costs for its own publicity helps alleviate any potential problems.