I've been searching Reg. Z, and I can't locate an answer to this.....if someone is late on their loan payment, are we required to send the late payment notice to both borrowers, or is one notice to the household sufficient?

Technically I am not sure any notice is required. Certainly it is a good practice for many reasons. But while Z tells you you have to disclose how much it is and when it is due, I don't recall any notification requirements to be sent when one is due.

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Andy Zavoina
Opinions stated are not necessarily that of my employer.

State law may also be an issue. South Carolina requires a Notice of Right to Cure be sent to a consumer in connection with delinquent consumer credit. "Consumer" is defined to include the "debtor," which in turn is defined to include "any cosigner, comaker, guarantor, endorser, or surety, any assignee of the obligor, and any person who agrees to assume the payment of a credit obligation." Commentary to the SC Consumer Protection Code states that the notice must be sent to all persons connected with the transaction that come within the definition of "debtor".

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Opinions expressed are my own, and do not necessarily reflect those of my employer.

Jim is right to be concerned about state law. Federal law, such as Regulation Z, only deals with making and extending the credit but does not cover notices relating to collection. Regulation B is about as close as it comes, and Regulation B allows you to send an adverse action notice (such as we are cancelling your account) to any one of the primary borrowers.