Jane comes in and secures a loan with a CD under her and her husbands name, but it only takes one signature to withdrawal funds. She is getting this loan without her husband knowing about it. We place a hold on the account and get and assignment of collateral. Concern: Couldn't the husband come in at anytime and cash in that CD since he had nothing to do with the loan it was pledged for collateral on?

As long as you have your hold properly placed he should not be able to make a withdrawal. It also only takes one signature to hold funds.

Thats another thing, shouldn't the borrower be the one signing the Notice of Hold form? Our Loan Officers sign it and I'm not really sure why they don't have the borrowers sign it as well.

Could be different in Idaho, but I just did a guaranty secured with CDs. Husband was the borrower, CDs had both husband and wife on them as signers, so on my assignment the wife was also a grantor. They both acknowledged the hold that I placed on the CDs.

You need a legal assignment of the CD not just a hold form. Check your State laws, in a case like this in Texas a certified letter to the other holder is required telling them of the encumbrance if they didn't sign the pledge agreement.

Randy - that is really interesting info. Thanks for sharing it here.

You think that a C.D. secured loan is one of the "easiest" of loans to document. Then to see that another state has such a requirement that can make a huge difference in collecting on a loan.

Sometimes one forgets that states can be so different in their requirements.