Skip to content
BOL Conferences
Learn More - Click Here!

New Reply Thread Options
#1956595 - 08/25/14 03:57 PM Can we charge a returned item fee on this loan?
Anonymous
Unregistered

We are allowed to charge this fee per state law.

However, we are not sure if it is contracted for with our current language. We don't explicitly state that we have a returned item fee- just that any fees disclosed are subject to change without notice (on our TILA). But, the returned item fee isn't stated in our note. Which makes me think we can't charge a fee.

But since we have the "subject to change" language, then could we charge the fee?

Return to Top Reply Quote Quick Reply Quick Quote
#1956625 - 08/25/14 04:38 PM Re: Can we charge a returned item fee on this loan? Anonymous
BurntSienna Offline
Diamond Poster
Joined: Aug 2006
Posts: 2,407
Midwest
The "subject to change" allows you to change/raise a properly disclosed fee (say from $20 to $25 for XYZ). The "subject to change" does not give you the right to charge a new fee for something you didn't disclose. If you haven't disclosed a "returned item fee" then you would have to send out a notice to all existing loan customers that you will begin charging this fee on <date 30 days or more in the future>. Then wait the 30 or more days, then you can begin charging.
_________________________
"Gratitude makes sense of our past, brings peace for today, and creates a vision for tomorrow." - Melody Beattie

Return to Top Reply Quote Quick Reply Quick Quote
#1956644 - 08/25/14 05:03 PM Re: Can we charge a returned item fee on this loan? Anonymous
Anonymous
Unregistered

So even though it isn't a change in terms per Reg Z, we should be okay if we treat it like one and ensure proper notification before adding the fee?

Return to Top Reply Quote Quick Reply Quick Quote
#1956648 - 08/25/14 05:11 PM Re: Can we charge a returned item fee on this loan? Anonymous
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 47,517
Bloomington, IN
So even though it isn't a change in terms per Reg Z, we should be okay if we treat it like one and ensure proper notification before adding the fee?

Not IMO. If you didn't contract for the fee up front then you can't unilaterally add additional charges after confirmation. Especially if you're dealing with closed-end credit.

You need to be talking to the bank's attorney.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

Return to Top Reply Quote Quick Reply Quick Quote
#1956762 - 08/25/14 08:05 PM Re: Can we charge a returned item fee on this loan? Anonymous
Richard Insley Offline
10K Club
Richard Insley
Joined: Oct 2000
Posts: 10,179
Toano, VA
I agree. If it's a loan (closed-end credit), you can do no more than the note states. Any change would require a modification agreement which would have to be executed by the borrower.
_________________________
...gone fishing.

Return to Top Reply Quote Quick Reply Quick Quote
Quick Reply:
HTML is disabled
UBBCode is enabled




Moderator:  MagicCity, P*Q, Truffle Royale