We currently offer two HELOC products one with a prepayment penalty up to 3 years and no fees, the other is fees with no prepayment penalty.. we are looking to add another option... no fees, no prepayment option but must have auto-pay out of bank account.

My thought is no you cannot tie accounts in this manner. however, I can't remember the rule.. any help is appreciated.

Thank you

You can do whatever is legal in your State.

The Commentary to §1005.10(e)(1) states:
Creditors may not require repayment of loans by electronic means on a preauthorized, recurring basis. A creditor may offer a program with a reduced annual percentage rate or other cost-related incentive for an automatic repayment feature, provided the program with the automatic payment feature is not the only loan program offered by the creditor for the type of credit involved.

Thank you!