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#1406876 - 06/22/10 08:50 PM
Re: Regulation Z - Open End changes - 7-1-10
#1hogfan
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Power Poster
Joined: Nov 2008
Posts: 4,132
Somewhere in the middle
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Any LaserPro users here?
If you charge a Inactive Fee ( A fee when the account has not been used in the past 12 months) where are you disclosing it?
When we choose the "Inactivity Fee" option, it places it in the "Set up and Maintenance Fees" box of the new form and then has this nice disclaimer:
NOTICE: Some of these set up and maintenance fees will be accessed before you begin using your account and will reduce the amount of credit you initially have available. Based on your initial lomit of $______, your credit limit will only be $_____.
You may still reject this plan, provided that you have not yet used the account or paid a fee after receiving a billing statement. If you do reject this plan, you are not responsible for any of these fees or charges.
_________________________
I'm only responsible for what I say, not for what you understand.
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#1406977 - 06/23/10 01:18 PM
Re: Regulation Z - Open End changes - 7-1-10
RR Joker
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Power Poster
Joined: Nov 2001
Posts: 7,985
FINALLY ABOVE the gnat line
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Not in my opinion...your statement will change, however. Joker, I've missed something - I thought the only statement changes were to credit cards. 226.7(b)(14) applies to all open-end(not home secured) consumer credit plans but it only applies to a deferred interest disclosure. Please tell me what statement changes should occur on the loan side - not credit cards - where I can find that.
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"Once you learn to read, you will be forever free." - Frederick Douglass
My Opinion Only.
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#1406996 - 06/23/10 01:32 PM
Re: Regulation Z - Open End changes - 7-1-10
waldensouth
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Power Poster
Joined: Aug 2002
Posts: 3,094
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226.7(b) 226.8 & 226.9 cover both cr cards & LOC.
226.7(b)(11)&(12) only apply to cr cards. Read 226.7(b)(13) carefully - most of it applies to cr cards except for the ending bal.
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Opinions are my own and not of my employer.
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#1407016 - 06/23/10 01:52 PM
Re: Regulation Z - Open End changes - 7-1-10
ahou
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Power Poster
Joined: Nov 2001
Posts: 7,985
FINALLY ABOVE the gnat line
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So basically, unless changes are being made to the account - the statement changes involve: 1. the way we disclose transactions 2. the format - grouping together certain items.
I thought it was so nice of the regulators to give us that handy little chart at the beginning - but it apparently doesn't cover everything.
_________________________
"Once you learn to read, you will be forever free." - Frederick Douglass
My Opinion Only.
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#1407023 - 06/23/10 01:58 PM
Re: Regulation Z - Open End changes - 7-1-10
waldensouth
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Diamond Poster
Joined: Sep 2008
Posts: 2,474
Midwest
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I just reviewed a statement produced by our vendor for our open ended non home secured line of credit. Everything seems to be correct but I question the statement peridoic rates may vary. They don't use those terms. By each daily periodic rate they have a (v) then at the bottom it states (v)= variable rate. Will this cause a problem?
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#1407025 - 06/23/10 02:00 PM
Re: Regulation Z - Open End changes - 7-1-10
waldensouth
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Power Poster
Joined: Aug 2002
Posts: 3,094
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Don't forget about the required terminology "Interest Charge" and "Interest Charged" plus "Total Interest", "Fees" and "Balance Subject to Interest Rate". Of course use "Annual Percentage Rate" too.
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Opinions are my own and not of my employer.
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#1407028 - 06/23/10 02:03 PM
Re: Regulation Z - Open End changes - 7-1-10
ahou
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Power Poster
Joined: Aug 2002
Posts: 3,094
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ahkcompliance, there is no required terminology for the variable rate disclosure - so you're ok.
_________________________
Opinions are my own and not of my employer.
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#1407035 - 06/23/10 02:07 PM
Re: Regulation Z - Open End changes - 7-1-10
ahou
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Diamond Poster
Joined: Sep 2008
Posts: 2,474
Midwest
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Great! I didn't think there was any required terminology but wasn't sure. It has always been peridoic rates may vary.
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#1407107 - 06/23/10 03:02 PM
Re: Regulation Z - Open End changes - 7-1-10
DD Regs
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Gold Star
Joined: Mar 2008
Posts: 294
The Texas Hill Country
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Any LaserPro users here?
If you charge a Inactive Fee ( A fee when the account has not been used in the past 12 months) where are you disclosing it?
When we choose the "Inactivity Fee" option, it places it in the "Set up and Maintenance Fees" box of the new form and then has this nice disclaimer:
NOTICE: Some of these set up and maintenance fees will be accessed before you begin using your account and will reduce the amount of credit you initially have available. Based on your initial lomit of $______, your credit limit will only be $_____.
You may still reject this plan, provided that you have not yet used the account or paid a fee after receiving a billing statement. If you do reject this plan, you are not responsible for any of these fees or charges. We use LPL - we don't have an activity fee but do have an annual fee. We were fighting that NOTICE as well, but finally figured out we needed to go back in and enter a minimum credit limit for the plan (not for the line but for the product itself) because the 15% calculation is off of the plan minimum which we had at -0- and was triggering the NOTICE. Once we set our minimum, the NOTICE no longer appeared. Hope this helps.
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#1407182 - 06/23/10 04:42 PM
Re: Regulation Z - Open End changes - 7-1-10
ItsJustMe
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Gold Star
Joined: Oct 2006
Posts: 344
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Does anyone know if this change applies to an overdraft line of credit attached to a checking account?
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#1407297 - 06/23/10 07:14 PM
Re: Regulation Z - Open End changes - 7-1-10
dollars & sense
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Diamond Poster
Joined: Sep 2008
Posts: 2,474
Midwest
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Yes, we made the required changes to our overdraft line of credit that is tied to a checking.
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#1407478 - 06/24/10 12:19 PM
Re: Regulation Z - Open End changes - 7-1-10
ahkcompliance
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Power Poster
Joined: Nov 2001
Posts: 7,985
FINALLY ABOVE the gnat line
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Thanks, ahou, for your help and your lists. I took your list of sections that impact each and made a little book of sections that affect our open-end credit products non RE secured and another book for our HELOCs. We don't have credit cards.
_________________________
"Once you learn to read, you will be forever free." - Frederick Douglass
My Opinion Only.
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#1407600 - 06/24/10 03:22 PM
Re: Regulation Z - Open End changes - 7-1-10
waldensouth
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100 Club
Joined: Feb 2004
Posts: 100
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Does the 45 day notice of default rate only apply to consumer unsecured RLOC's or would it also apply to a consumer RLOC secured by a certificate of deposit?
Thanks for any replys
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#1407900 - 06/24/10 07:45 PM
Re: Regulation Z - Open End changes - 7-1-10
FC
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Platinum Poster
Joined: Nov 2007
Posts: 767
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I could be wrong, but I think it applies to anything other than RE secured.
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Comments are strictly my own and not that of my employer.
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#1407968 - 06/24/10 08:47 PM
Re: Regulation Z - Open End changes - 7-1-10
Still Smiling
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10K Club
Joined: Nov 2002
Posts: 20,656
The Swamp
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I would agree to that as well.
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My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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#1408119 - 06/25/10 01:52 PM
Re: Regulation Z - Open End changes - 7-1-10
Deena
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Diamond Poster
Joined: Nov 2004
Posts: 2,310
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I don't know for sure, but I wouldn't think that a reg required change in terminology on the periodic statement would require a change in terms notice. If it does, we'll all be sending change in terms notices to all our open-end credit customers because they'll all have the old "finance charge" terminology in the notes. Deena, thanks for your response. Is everyone keeping the phrase "finance charge" in credit line agreements for section 226.6(b) disclosures that will be provided on or after 7/1/10? Will you provide any explanation in the credit line agreements to explain that the term "interest charge" will appear on the periodic statements? I've been looking at section 226.5(a)(2)(i) which says "Terminology used in providing the disclosures required by this subpart shall be consistent." Comment 4 of the OSC to this section says "Language used in disclosures required by this subpart must be close enough in meaning to relate the different disclosures; however, the language need not be identical." Section 226.4 of Reg. Z still refers to finance charges and section 226.6(b) does not mandate the phrase interest charge except for the table required for credit card plans.
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Opinions expressed are my own and not necessarily those of my employer. They are not legal advice.
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#1408299 - 06/25/10 04:29 PM
Re: Regulation Z - Open End changes - 7-1-10
RR Joker
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100 Club
Joined: Mar 2005
Posts: 200
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We have some loans set up as revolving lines of credit attached to a checking account for overdraft protection - I did not consider these accounts when looking at the Reg Z open end changes because they are consumer loans that are extended annually - should they be considered because they are revolving?
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#1408359 - 06/25/10 05:27 PM
Re: Regulation Z - Open End changes - 7-1-10
Compliance Audit
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10K Club
Joined: Nov 2002
Posts: 20,656
The Swamp
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We have a RR account (with no actual maturity) that is tied like your's is and I had to make changes to our account opening disclosures, so I would say yes. The Schumer box content is what changed.
_________________________
My opinion only. Not legal advice. Say you'll haunt me - Stone Sour
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#1408428 - 06/25/10 06:57 PM
Re: Regulation Z - Open End changes - 7-1-10
SaaL
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Power Poster
Joined: Nov 2008
Posts: 4,132
Somewhere in the middle
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Any LaserPro users here?
If you charge a Inactive Fee ( A fee when the account has not been used in the past 12 months) where are you disclosing it?
When we choose the "Inactivity Fee" option, it places it in the "Set up and Maintenance Fees" box of the new form and then has this nice disclaimer:
NOTICE: Some of these set up and maintenance fees will be accessed before you begin using your account and will reduce the amount of credit you initially have available. Based on your initial lomit of $______, your credit limit will only be $_____.
You may still reject this plan, provided that you have not yet used the account or paid a fee after receiving a billing statement. If you do reject this plan, you are not responsible for any of these fees or charges. We use LPL - we don't have an activity fee but do have an annual fee. We were fighting that NOTICE as well, but finally figured out we needed to go back in and enter a minimum credit limit for the plan (not for the line but for the product itself) because the 15% calculation is off of the plan minimum which we had at -0- and was triggering the NOTICE. Once we set our minimum, the NOTICE no longer appeared. Hope this helps. Thanks that helped!!
_________________________
I'm only responsible for what I say, not for what you understand.
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#1409369 - 06/29/10 03:04 PM
Re: Regulation Z - Open End changes - 7-1-10
DD Regs
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Platinum Poster
Joined: May 2008
Posts: 915
Orlando, FL
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I was going to make a brief power point pres pertaining to the Reg Z changes eff on 7/1 to present to the lenders at a loan committee meeting tomorrow, but I am drowning in month-end and qtr-end stuff!
Has anyone already created a similar piece they would be willing to share?
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#1409398 - 06/29/10 03:42 PM
Convenience Checks
RR Joker
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Diamond Poster
Joined: Sep 2002
Posts: 1,117
On the road...
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We have an open-end consumer (not home secured) loan that is called Write a Loan. They access the line by writing a check. They do not have a credit card. It is not tied to their checking account. We do not have to comply with 12 CFR 226.9(b)(3)... or do we?
_________________________
Michelle CRCM
"What would you attempt to do if you knew you could not fail?" ~ unknown
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#1409987 - 06/30/10 04:19 PM
Re: Convenience Checks
Patsy Cline
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Diamond Poster
Joined: Nov 2000
Posts: 1,820
Southern California
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Did anyone create a communication piece to customers about the changes to their statement and the terminology? If so, would you be willing to share?
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Dolly Nugent CRCM Opinions expressed are my own.
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#1410842 - 07/01/10 07:06 PM
Re: Convenience Checks
Dolly Nugent
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Diamond Poster
Joined: Sep 2008
Posts: 2,474
Midwest
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Are there any Fiserv banks that offer a DDL product?
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