Issue:
We have two types of consumer unsecured LOC accounts on our system. One has a fixed maturity date. The other does not.
Currently, the customers with the maturity date, must come to the bank and re-apply for the loan. This requires standard underwriting and is inconvenient to the customer and not cost effective for the bank.
Our note currently has the following language:
"You agree that we may renew or extend the period during which you may obtain credit advances or make payments. You further agree that we may renew or extend your Credit Line Account." We would allow for an opt-out, unless this is an unnecessary step.
We would like to do a system maintenance, changing the LOC accounts with a maturity date, mirroring the other product with no maturity date.
Letters would be sent to the customers a minimum of 45 days before the change.
Looking for any input on this proposal. Thank you for your time.