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#1579236 - 07/18/11 03:21 PM CRA Renewals
cra123 Offline
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Joined: Dec 2009
Posts: 13
Need input on two renewal scenarios:

1. Demand LOC comes up for annual renewal and is converted from a demend line to a hard maturity date. Is this a CRA reportable renewal? I'm thinking no since the term isn't actually extended.

2. Loan is modified to increase the loan amount but the term isn't extended, therefore not meeting the definition of a CRA renewal. Is this reportable? For example, if the note is modified from $75,000 to $100,000 but the term stays the same, is it reportable and what amount do I report?

Thanks in advance!

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CRA
#1579247 - 07/18/11 03:34 PM Re: CRA Renewals cra123
bOaty Offline
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Chillin an grillin
1. I would report this (maybe I'm wrong, I don't have anything to back this up but I have always reported these)

2. Report the $25,000 increase
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#1579330 - 07/18/11 05:00 PM Re: CRA Renewals bOaty
jef68 Offline
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Posts: 88
We report demand lines converting to a hard maturity date also. I too have nothing to back this up but since we are giving it a maturity date we are considering it a renewal.

We also would report the increase even though you are not extending the maturity date.

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#1579346 - 07/18/11 05:11 PM Re: CRA Renewals cra123
Kathleen O. Blanchard Offline

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I would report #1 because you have changed from a pure demand with an internal review annually to an actual legal annual renewal with a true maturity date.

For #2, yes report the new $.
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#1606557 - 09/21/11 05:02 PM Re: CRA Renewals Kathleen O. Blanchard
SJB Offline
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California
In the CRA Q&As discussion of renewals, they state a "demand loan" has no term so it cannot be renewed. Is a demand loan one with just a demand clause and no term?
We have an LOC that has a one-year term but also a demand feature (i.e., we could call the loan before the end of the year) and can be renewed each year after we review current credit reports and financials. Would that be considered a "demand loan?"
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#1606678 - 09/21/11 06:19 PM Re: CRA Renewals SJB
Kathleen O. Blanchard Offline

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Kathleen O. Blanchard
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I consider "demand alternate maturity" loans to be reportable. What you have is a loan good through x date UNLESS the bank demands it prior to that date. It is not good after that date and must be renewed.

A pure non-reportable demand loan only states that it is payable on demand. That loan can sit out there for years, with an internal periodic review to determine if the bank wishes to make demand or allow it to continue.
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Kathleen O. Blanchard, CRCM "Kaybee"
HMDA/CRA Training/Consulting/Mapping
The HMDA Academy
www.kaybeescomplianceinsights.com

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#1606857 - 09/21/11 09:03 PM Re: CRA Renewals Kathleen O. Blanchard
SJB Offline
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California
Thanks KB!
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