Does a customer have to give a specific rationale for the 'bona fide emergency' or does their hand written letter just have to state 'bona fide emergency'?

The letter has to state what it is. And just because the customer writes a letter and thinks it's an emergency doesn't mean the bank can automatically allow the waiver. You still have to determine whether or not it is a "true" emergency.

Thanks! If they go through with it, I've told the loan officer and processor that I want to review the letter before any action is taken.

In my way too many years in lending and in compliance, I've seen one instance of a true emergency! Tread carefully!!

I am! I'm trying to dissuade them entirely and I think I'm almost there. I don't know what the 'emergency' is, but I think I've got them sufficiently spooked.

good going!

FWIW in all the years I've been doing this I have never seen a true "financial emergency" that we waived the wait period for.

In my 30+ years I have never seen a waiver. Once an examiner gave me an example : You need the cash to pay for a life threatening surgery for your son/daughter.

And there wasn't a true emergency in this case, so there will be NO waiver!

Perhaps the roof blew off and the collateral will be ruined...that could also be an emergency. It has to truly be dire. Health, total loss of home, etc.

A Texas attorney provided this guidance in a recent letter to clients.

" . . . The term “bona fide personal financial emergency” is not defined by the Final Rule, although it is the identical term upon which waiver of the right of rescission by consumers for certain loans is conditioned and should be similarly narrowly construed. Whether such an emergency exists must be determined from the facts of each applicant’s situation as set out in the applicant’s written waiver statement. The imminent sale of the applicant’s home at foreclosure during the waiting period is suggested in the Final Rule as one example of such a bona fide personal financial emergency. Presumably, obtaining funds to repair a storm-damaged dwelling in an area declared by the President to be in a major disaster area may be another example. However, mere personal inconvenience or economic loss occasioned by the enforced waiting period would not satisfy the test of such a personal financial emergency. Creditors should be cautious in making these determinations particularly because the mere existence of the loan applicant’s written waiver statement will not in itself automatically insulate a creditor from liability for failing to comply with the waiting period requirements. . . ."