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#1793332 - 03/11/13 04:35 PM Loan for Adult Entertainment Club
rachelchri Offline
100 Club
Joined: Aug 2010
Posts: 165
We have a customer requesting a Commercial Loan and the collateral would be their Adult Entertainment Club.

Is there any rule or regulation stating we cannot accept this Club as collateral, or is this a Bank-to-Bank decision as to what type of business we want to lend to? If so, what are other Banks doing in this situation?

Thanks!

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Lending Compliance
#1793411 - 03/11/13 06:14 PM Re: Loan for Adult Entertainment Club rachelchri
Rocky P Online
Power Poster
Joined: Jun 2003
Posts: 7,650
Florida
The bank would be governed by your your loan policy. Some banks have written that the collateral/borrower would not be a reputational risk to the bank.

IMHO, the only restrictions in federal law would fall under fair lending affected by disparate impact - (such as wording to impact lending to businesses which may be heavily run by/cater to protected classes).

Whatever is in your policy, make sure it is universally enforced.
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