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#2071112 - 03/26/16 02:56 PM household goods
theloanbug Offline
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Joined: Sep 2005
Posts: 746

Customer purchasing refrigerator, but loan will have no collateral so this is not consider a purchase money interest, correct?

Thanks

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Lending Compliance
#2071115 - 03/26/16 05:51 PM Re: household goods theloanbug
Rocky P Offline
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Joined: Jun 2003
Posts: 7,650
Florida
Reg says you cannot have
"(d) Security interest in household goods. A nonpossessory security interest in household goods other than a purchase money security interest."

You do not have a security interest in the refrigerator (loan is unsecured) - not an issue. Imagine if they bought it with a credit card - same thing - no security interest.
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#2071116 - 03/26/16 09:58 PM Re: household goods theloanbug
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,229
Galveston, TX
Rocky - what Reg.?
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#2071118 - 03/27/16 10:40 AM Re: household goods theloanbug
Rocky P Offline
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Joined: Jun 2003
Posts: 7,650
Florida
I was looking at 227.13(d)

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#2071119 - 03/27/16 02:11 PM Re: household goods theloanbug
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 83,229
Galveston, TX
Regulation AA was repealed last Monday.
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#2071123 - 03/28/16 12:15 PM Re: household goods theloanbug
sway Offline
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Joined: Feb 2011
Posts: 128
I want to make sure I am understanding the Reg AA repeal correctly.

My Regulation AA compliance review looks at ensuring particular provisions are not in consumer lending forms, the bank does not allow pyramiding of late charges, the bank does not take non-possessory, non-purchase money security interest in household goods, and reviewing Notices to Cosigners. I was under the impression the CFPB will still plan to enforce Reg AA through UDAAP under its general enforcement jurisdiction? If so, I was wondering how we would handle any violations during our audit that would have arisen under 227 now that it doesn't exist? Would we now use U.S.C Section 5531(a) and 5536 as a citation for a finding?

Or are you saying we no longer have to review for compliance under this area?

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#2078977 - 05/17/16 05:16 PM Re: household goods theloanbug
TomTom Offline
Member
Joined: May 2014
Posts: 61
I found this helpful. Looks like the authority will reside in sections 1031 and 1036 of the Dodd-Frank Act (I believe codified in the USC sections you referenced) and the old prohibitions are arguably still in effect, just in a less official manner.

http://www.federalreserve.gov/newsevents/press/bcreg/bcreg20140822a2.pdf

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