Have some Loan Officers wanting to keep a copy of the key to vehicles used as loan collateral. Does anyone have any thoughts?

I personally think this is a bad idea, but again I wouldn't make some of these loans in the first place. PERIOD. Having or not having a key would not improve the quality of the loan to me.

For one, it tells me the loan officer has reason to doubt the loan. If you have doubts, why the #@$% are you making the loan???

Second, discrimination, if you don't get a copy of the key on each loan. You're not "treating everyone equally"

Third, security of the keys. We have enough to keep up with, you want to create more work?

Please give me your thoughts or ideas. If anyone does this, please give me the ins and outs, how is it perceived by examiners?

Thanks in advance

Not from Texas but...

I think you know this is a horrible idea. If you are going to take the key, why bother filing a lien?

Fair Lending would be a huge risk, as you noted.

If the lender is not willing to make the loan, without retaining a key, they shouldn't be making the loan. In addition, I would be providing Fair Lending training to the LOs asking for this.

Would they do a mortgage if the lender were to keep a key to their home?

You're kidding, right. Please tell me you are kidding. Where did these LOs come from. The Jurassic period???

Some times you've just got to tell an LO, "No, you're not going to do that, and, no, I'm not going on a wild goose chase to find out the 20 reasons why you're not going to do it."

So what happens if the car is stolen? The customer can say, "The only other key was is the bank's hands - they must have stolen it!" Can you imagine that on the 6:00 news?

Tell them they can keep a copy, then walk them over to the copier.

Reminds me of a few years ago when there was a dealer that had a kill switch on cars they financed. Miss a payment and they kill the car. You call the dealer to say "[censored]" and they now have contact and can make payment arrangements. So all is good - right? Not when the system was hacked and many people had the kill switches activated. Liability for that just slaps you in the face.

Do it.

That way, when the customer loses his key he can call the loan officer at home and have him or her go to the bank to get the other one. (Otherwise, he might have to pay up to $150 to get an electronic key replaced.) It will be a great customer service and demonstrate that people who have dumb ideas should carry the weight of their dumb idea without handing it off to someone else.

If they're coming to you with this question, just think of what they are doing that they're not telling you about! I shudder....

Y'all just need to start taking Bitcoin:

In the basic Bitcoin transaction, if Bob wants to send Alice a bitcoin he needs two pieces of information: his private key, and an address generated from her public key. Anyone can send money to a Bitcoin address, but only a signature generated by the private key can release money from it.

But what if the private key were a car key? A car owner or a rental company or a lender could configure a vehicle to turn on only if it receives a message signed by a private key that owns a colored coin.

"Were I to borrow money in order to buy a Tesla," says Luria, "as long as I make my payments, that would be reflected by my bank to the blockchain and I would be able to continue to operate my vehicle. But were I to stop making payments on my car, instead of lawyers and debt collectors and repo men getting involved—if the blockchain was not to receive a message from the bank that I'd made my payment that month—they could disable the Tesla and quite directly prevent me from operating it."

Not a new idea:

http://edition.cnn.com/2009/LIVING/wayof...l?eref=rss_tech

I prefer the old fashioned way: http://theexpiredmeter.com/wp-content/uploads/2008/10/repomanvideo.jpg