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#254011 - 10/07/04 09:29 PM 217 Negative Information - One more time!
Ninky Gold Star Joined: Nov 2002 Posts: 357	Harland considers the negative information notice a post closing issue, so they are not adding this notice as one of their options. Would it be acceptable to add a small custom section in the second page of the promissory note adding the model language?
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#254012 - 10/07/04 09:42 PM Re: 217 Negative Information - One more time!
Jack Holzknecht Gold Star Joined: Aug 2001 Posts: 330 Louisville, KY	The law allows the notice to be provided "prior to" reporting the negative information - placing it on a late notice for example. The FTC is arguing that the notice must be sent in connection with reporting the negative information. Again placing it on the late late notice would suffice, but providing it at closing or application would not. The position of the other agencies on this point is not clear. Congress seemed to contemplate that the notice could be provided at closing or application, as long as it did not appear on the early TIL disclosure. Until final regulations are published, no one knows for sure.
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#254013 - 10/08/04 05:07 PM Re: 217 Negative Information - One more time!
Ninky Gold Star Joined: Nov 2002 Posts: 357	That being said, if Congress and the other agencies prevail and the notice may be provided at application or closing, does a bolded section in the promissory note, along with other sections, i.e. right of setoff, successor interests, etc., qualify as clear and conspicuous? Is anyone else using this as a solution?
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#254014 - 10/12/04 10:27 PM Re: 217 Negative Information - One more time!
Anonymous Unregistered	Am I understanding correctly that final regulations are to be published that will (hopefully) clarify Section 217 in addition to the model notices that we have?
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#254015 - 10/13/04 01:26 PM Re: 217 Negative Information - One more time!
ToTo Platinum Poster Joined: Apr 2004 Posts: 595 OZ	If you look at 217 of the act you will see that the only requirement of this section is that the Federal Reserve provide the "model" disclosure forms, which they have already done. We MAY see additional regulations, but we may not. FACT does not require that any additional regulations will be forthcoming.
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#254016 - 10/13/04 01:53 PM Re: 217 Negative Information - One more time!
murphysgirl Gold Star Joined: Oct 2004 Posts: 269 Home of the Red Sox	Newbie here-be gentle. I just returned from a training a few weeks ago where the Mass Banker's Sponsored program speaker told the group that providing the disclosure at closing is the easiest way to comply. I did not agree because it was a little like putting the cart before the horse, we are sticking to the late notice disclosure. _________________________ Humility about how little I know has encouraged me to listen more carefully and more wisely. John Templeton
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#254017 - 10/13/04 02:32 PM Re: 217 Negative Information - One more time!
StevenD Gold Star Joined: Nov 2000 Posts: 489 KY	Interesting that they would say that.... 217(a)(7)(B)Time of Notice (ii)Coordination With New Account Disclosures. -- If the notice is provided to the customer prior to furnishing the negative information to a consumer reporting agency, the notice may not be included in the initial disclosures provided under section 127(a) of the Truth in Lending Act. _________________________ Opinion expressed are my own and not necessarily those of my employer.
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#254018 - 10/14/04 05:57 PM Re: 217 Negative Information - One more time!
Anonymous Unregistered	Interesting indeed Anon, and I checked with other attendees (just to make sure I wasn't hearing things) and guess what- they all heard it too and one of them have already begun using disclosures at closing-ya just don't know who to listen too-that's why I am here.
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#254019 - 10/14/04 06:13 PM Re: 217 Negative Information - One more time!
Anonymous Unregistered	They may be provided at closing in another document---just not with the Truth In Lending disclosures.
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#254020 - 10/14/04 06:24 PM Re: 217 Negative Information - One more time!
Anonymous Unregistered	and as I look up the power point hand-out I was given at the seminar and I quote "2 ways to comply 1.) deliver the notice within 30 days after the furnishing negative information.... 2.) Prior to furnishing negative information Model B-1 may be given at the time of loan closing but cannot be included in TILA fed box. The Speaker then remarked (and I wrote it down) "#2 is the easiest way to comply."
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#254021 - 10/15/04 03:49 AM Re: 217 Negative Information - One more time!
GreatBlue Diamond Poster Joined: Feb 2003 Posts: 2,362 Colorado	Quote: 2.) Prior to furnishing negative information Model B-1 may be given at the time of loan closing but cannot be included in TILA fed box. Did anyone ever think to actually check what section 127(a) of the Truth in Lending Act is even referring to? It has nothing to do with the Fed Box. _________________________ Opinions are mine and not necessarily my employer's.
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#254022 - 10/15/04 01:36 PM Re: 217 Negative Information - One more time!
ToTo Platinum Poster Joined: Apr 2004 Posts: 595 OZ	I agree with Great Blue. 127(a) of TILA refers to the initial disclosures under open end credit, which would be 226.6 under the Regulation. That is the only restriction under this section of the act regarding where the notice may not be included. This has nothing to do with the Fed Box under closed end credit.
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#254023 - 10/18/04 01:38 PM Re: 217 Negative Information - One more time!
David Dickinson 10K Club Joined: Nov 2000 Posts: 18,763 Central City, NE	This is correct. IOW, I can't give the Negative Disclosure with the HELOC application disclosure, but I can give it at closing with the FINAL TIL disclosure. _________________________ David Dickinson http://www.bankerscompliance.com
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#254024 - 10/18/04 06:31 PM Re: 217 Negative Information - One more time!
Anonymous Unregistered	I thought the final rules were issued already for Sec 217.
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#254025 - 10/18/04 09:07 PM Re: 217 Negative Information - One more time!
ToTo Platinum Poster Joined: Apr 2004 Posts: 595 OZ	David, I don't think that is correct. FACT prohibits that the disclosure be included in the "127(a)" disclosures and not the "127A" disclosures. 127(a) are the initial open end disclosures (see the 226.6 of the Regulation) that would appear in a cardholder agreement or credit agreement, including a home equity line of credit agreement. 127A would be the application (or early) disclosures for HELOCs (see 226.5b of the regulation). FACT states that the negative information disclosure may not be included in the 127(a) disclosures.
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#254026 - 10/22/04 03:12 PM Re: 217 Negative Information - One more time!
David Dickinson 10K Club Joined: Nov 2000 Posts: 18,763 Central City, NE	I think that is what I said. _________________________ David Dickinson http://www.bankerscompliance.com
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#254027 - 11/01/04 04:35 PM Re: 217 Negative Information - One more time!
Anonymous Unregistered	Hi, Just want to make sure on this - my committee has decided to address this issue by purchasing a seperate, stand-alone disclosure (the only thing on the paper) to provide at time of application and in the next statement for all existing customers. I asked at a seminar recently and was told that method would be in compliance. This is correct isn't it?
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#254028 - 11/01/04 05:00 PM Re: 217 Negative Information - One more time!
Cryin&Complyin 100 Club Joined: Jun 2004 Posts: 106 The Deep South	Quote: David, I don't think that is correct. FACT prohibits that the disclosure be included in the "127(a)" disclosures and not the "127A" disclosures. 127(a) are the initial open end disclosures (see the 226.6 of the Regulation) that would appear in a cardholder agreement or credit agreement, including a home equity line of credit agreement. 127A would be the application (or early) disclosures for HELOCs (see 226.5b of the regulation). FACT states that the negative information disclosure may not be included in the 127(a) disclosures. I agree ToTo. The disclosures in 226.6 are the "initial" disclosures...i.e. the actual agreements that are executed at the time of closing. The disclosures David referenced are the 226.5b disclosures....i.e. the "early" disclosures given at the time of application for a HELOC. Based on what I'm reading here, it sounds like the 217 disclosure cannot be included in the agreement used for HELOCs, Open End Lines of Credit, etc. and is NOT referencing the HELOC disclosures given at the time of application. I don't guess they wanted to make this TOO simple for us.... _________________________ *[color:"teal"]My opinion is my own, often to the dismay of my employer![/color]*
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#254029 - 11/01/04 05:11 PM Re: 217 Negative Information - One more time!
David Dickinson 10K Club Joined: Nov 2000 Posts: 18,763 Central City, NE	I get it. I was referring to the application disclosures, when it should be the "initial disclosure" (IOW, the closing of the HELOC, credit card or over-draft line). Thanks for setting me straight. _________________________ David Dickinson http://www.bankerscompliance.com
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#254030 - 11/01/04 05:28 PM Re: 217 Negative Information - One more time!
Anonymous Unregistered	When the notice is a separate piece of paper clearly written (as opposed to being a part of any other disclosure), then it would be definately be okay to hand out at the time of application, right?
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#254031 - 11/03/04 07:21 PM Re: 217 Negative Information - One more time!
Anonymous Unregistered	then it would be definately be okay to hand out at the time of application I agree, that is what we are doing.
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#254032 - 11/04/04 02:19 PM Re: 217 Negative Information - One more time!
Anonymous Unregistered	thanks
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