Our HELOCs have a term of 10 years. To continue for another 10 years, a new combined HELOC Disclosure/Agreement is signed by the customer. At the same time, the bank is getting a Modification Agreement that references the original agreement from 10 years ago and modifies the maturity extending it out another 10 years. There is no mention of the newly executed agreement.

Are we essentially refinancing and modifying this loan?

In a HELOC audit I wrote up a violation for not providing the ROR because the loan looked like a refinancing. I never even looked at the modification agreement because in the past when one is present in the loan file it is modifying the Deed of Trust, not the Note.

However, the department has informed me that they don't refinance the HELOC, they modify/renew the note using a modification agreement, therefore, ROR doesn't apply.

Looking back, it appears that we do both. Does one trump the other?

Do we have a refinancing or a modification? Does ROR apply or not?

Any input would be greatly appreciated!

If you just modify the existing HELOC prior to maturity without an increase in the credit line, then there are no disclosures or RofR requirements. If modification happens after maturity, it is a new plan and all disclosures and RofR would be required.

As far as the documents you are using to execute the "modification", only your legal counsel can answer that question after reviewing all the various documents to which you refer.