I'm sure this has been discussed already somewhere; however, I am getting too many responses to my search requests.

Now that the CCA has been amended and we are no longer required to provide 21 days between the mailing date of the periodic statement and the payment due date for overdraft lines and home equity lines of credit, how many of you will be changing back to your former practices?

We are not "changing back" after providing a change notice. The law has changed, but Reg Z has not yet been changed; and thus we are not taking the risk that we would have to monitor our portfolio for past due account reporting or late charges.
$23 billion bank group.

At this point, we do not plan to change back.

I would not be surprised if this doesn't resurface in the amended final HELOC rules when they are issued.

I know Fed agreed to this, but did the FDIC? If so, was anything published? Can't believe I may have missed it, so little is going on right now in the world of compliance! Ha, ha.

It's the FRB's regulation. If they agree to it, all agencies (FDIC) must also comply. The other agencies don't have any interpretation authority.

Do you wanna tell the FDIC that?


Correct to say though that the FRB has not incorporated this yet, technically, it is still a requirement, or no?

The FDIC KNOWS that. The law drives regulations. The law was clarified (technically, it was amended with a new law). The regulation CAN'T stand on it's own without a supporting law/statute. So it's not a requirement except for Credit Cards.

Where's this at for home equity lines of credit? Are they now also required to have statements 21 days before payment due date with the Credit CARD Act changes despite the earlier amendment excluding them?

Think I found it - looks like they did finalize/correct 226.5(b)(2) to just be applicable to open-end (not home secured) credit, so it's not applicable to HELOCs. Please just correct me if I am misunderstanding.

Thank you!

Thought this was a dead issue...We changed our HELOC's, PLOC's and Ready Credits back in August of 2009 to provide for a 21-day advance statement. I know the 21-day requirement for HELOC's got repealed soon after but we elected not to make any changes back at that time (too confusing to the customer).

My ops department wants to change the statement cut back on HELOC's to what they were before the reg change (for operational reasons). I don't see any problem with doing so.

My question is what about the PLOC's (non-home secured personal lines of credit)? These are not accessible by a card and don't seem to meet the definition of "Credit card account under an open-end (not home secured) consumer credit plan" under 222(a)(15)(ii) so do PLOC's have to have a 21-day advance statement?

Can I treat PLOC's that same as HELOC's?

I have a related question. We originally changed all our LOC's (including HELOC) to the longer notice period and made the "Finance Charge" to "Interest Charge" on the statements. We didn't change anything back.

I have an auditor now telling me that we must use "Finance Charge" on the HELOC statements since they don't apply. Anyone else make/not make this change?

227.7(6)(a) states - Amount of finance charge and other charges. Creditors may comply with paragraphs (a)(6) of this section, or with paragraph (b)(6) of this section, at their option.

a6 (HELOC) references Finance Charge and b6(not RE secured) Interest Charge, is either acceptable?

RF, our examiner said we had to use Finance Charge on the HELOCs, however our core (Metavante/FIS) said they would not change our notices back from interest charge to finance charge until they waited to see if it was going to 'stick'. Frankly, don't blame them. It is hard enough to make all the regulatory changes, just for the feds to change the same ones again before the ink is dry on our P&Ps.

226.7(a)(6)Amount of finance charge and other charges. Creditors may comply with paragraphs (a)(6) of this section, or with paragraph (b)(6) of this section, at their option.

I am not actually sure how much clearer this could be. You can comply with either. If you are fully complying with (b)(6) then what is the argument?

Kathy, I'm also FIS and haven't heard back from them. But I do remember having to pay to have it changed in the first place.


Thanks Randy, that is my argument.

When you read (b) separately it says it "applies only to plans other than home-equity". The auditors are stuck on this. They are also using the OCC workbook that says "Finance Charge" and are sticking with it.

They are wrong and the OCC workbook has not been updated to address these changes. If this an auditor and not an examiner, they need to go back to school and learn how to read . If this is an examiner - you need to press this to a higher level. Do not stand for this either way.....

P.S. If this is an auditor, is it internal or external?

They are an outsourced internal audit/consulting firm. They say say they have had a client cited by examiners for it. I'm not inclined to just rely on their interpretation, and I don't like to lose either.

I don't see it as a huge issue. But I don't want to pay again to have it changed back if I don't have to.

Thanks again for your input

Then you need to kick it up the chain of the external audit firm. Regulators are sometimes wrong and banks fail to sometimes fight back. The mere fact that it was cited at another bank and the clear indication that it has no basis in the actual regulation, shows that this firm is clearly lacking in regulatory compliance auditing or consulting skills. If they won't change their mind based on absolutely clear regulatory language, then give me a call (or any one of the other consultants listed on the BOL guru page) and we would be glad to step into their shoes next year. I worked for 20 years in the NW and would welcome another visit

http://www.bankersonline.com/gurucentral.html

Or the other option is to just print this thread and give it to them and see what their reaction might be.....

Mr. Carey is, of course, correct (as he usually is!) I was working as a consultant for a large bank's HELOC program (adding a 'lock' feature), looking to use their unsecured LOC periodic statement, to be used for their HELOC program. After much research, I confirmed with the Fed Board attorneys (2) that: The option to use "Interest Charges/Total Interest" and "Fees" instead of "Finance Charge" is there for use with HELOCs. It gets better, though! Although a bank may, under the same provision, just use "Interest Rate" instead of APR, they can 'mix n match' and still use "APR" since there is no per se prohibition in doing so.