Is a periodic statement required if a customer has not drawn on his HELOC account? We have some borrowers that have a
2nd HELOC for emergency funds and a review shows that they have not made a drawn on the account in 6 months. There is
no balance. Anyone else have experience with their HELOCs? Thanks.

1026.5.(b)(2) Periodic statements. (i) Statement required. The creditor shall mail or deliver a periodic statement as required by §1026.7 for each billing cycle at the end of which an account has a debit or credit balance of more than $1 or on which a finance charge has been imposed.

Thank rl. We are in the middle of a Comp Exam now. I reviewed .7 but missed .5. Thanks.

I recently looked into this for our HELOC's. Unfortunately, our statement is not set up "substantially similar" to sample G-18(A).

§ 1026.7(b)(6)
(b)(6) Charges imposed
(i) The amounts of any charges imposed as part of a plan as stated in § 1026.6(b)(3), grouped together, in proximity to transactions identified under paragraph (b)(2) of this section, substantially similar to Sample G-18(A) in appendix G to this part.

Gertie,

What does that have to do with whether or not you have to send a periodic statement in any given month? Can you explain?

Sorry, I should have provided more info. My understanding is that you do not have to send a periodic statement on a HELOC if the account has a zero balance for 2 or more consecutive billing statements, and if your statement is substantially similar to the sample in appendix G. Since our statement is not substantially similar in appearance, we could not stop sending the periodic statement. I would love to be wrong in this particular circumstance.

1026.7(a) Rules affecting home-equity plans.
The requirements of paragraph (a) of this section apply only to home-equity plans subject to the requirements of § 1026.40 (Requirements for home equity plans). Alternatively, a creditor subject to this paragraph may, at its option, comply with any of the requirements of paragraph (b) of this section; however, any creditor that chooses not to provide a disclosure under paragraph (a)(7) of this section must comply with paragraph (b)(6) of this section.

I guess I fail to see the relationship between whether or not you are complying with 1026.7(a) versus whether or not you are required to send a periodic statement in 1026.5(b)(2) for any given month. What am I missing?

Randy, as usual, you did not miss anything. When I did my research, I focused on 1026.7(a) Rules affecting home-equity plans. After your comments I did additional research and now see that I "went down a rabbit hole"; interestingly, I was able to take our compliance advisory company with me.

The good news is that our exchange prompted me to put the question to one of our examiners, who concurred that we may rely on 1026.5(b)(2)(i). Thank you for the extra push. I appreciate it.