Skip to content
BOL Conferences
Thread Options
#30715 - 09/03/02 02:25 PM Home Equity
Anonymous
Unregistered

Does anyone have a list of the documents needed in making an open-end home equity loan?

Return to Top
Lending Compliance
#30716 - 09/03/02 07:52 PM Re: Home Equity
Anonymous
Unregistered

This is my list of needed documents, please tell me if anything is missing.
    At HELOC Application Request:
    Application
    Privacy Notice
    Insurance Disclosure
    Special Information Booklet
    Initial TIL Discosure - retainable

    When Application is Received:
    ARM Disclosure
    Notice of Right to Receive Appraisal

    Loan Closing:
    Right of Rescission
    Standard Flood Determination
    Flood Notice (flood plain only)
    Promissory Note
    Mortgage
    Appraisal
    Your Billing Rights Notice
    Agreement to Provide Insurance
    Fair Credit Reporting Act Information

    Subsequent Docs:
    Periodic statements
    Flood Insurance (flood plain only)
    Insurance



Return to Top
#30717 - 09/03/02 08:41 PM Re: Home Equity
Dan Persfull Online
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 47,517
Bloomington, IN
Your list looks complete. You do not need an ARM disclosure when the application is received. Your initial disclosures, which are due when an application is given to the applicant, should cover all the necessary disclosures of the the HELOC program. I'm sure you have already reviewed 226.5(b). If your initial disclosure follows the guidelines given in this section, then you should not have to give any subsequent program disclosures before consumation.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

Return to Top
#30718 - 09/03/02 08:45 PM Re: Home Equity
Dan Persfull Online
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 47,517
Bloomington, IN
I forgot to mention that I would be glad to email you an example of our disclosure that is produced by our software program.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

Return to Top
#30719 - 09/03/02 10:08 PM Re: Home Equity
Anonymous
Unregistered

Anon-
I do not agree with everything on your list. For an open-end home equity line of credit, you need to distribute, with each application form, the "When Your Home Is On The Line" brochure and a disclosure that describes the terms of your plan as required by section 226.5b(d) of Regulation Z. Refer to Appendix G for sample forms of the home equity disclosure. You need to provide the disclosures required by section 226.6. We make these disclosures in our credit line agreement which the borrower signs at loan closing. You only have to give ARM program disclosures for closed-end credit loans. If your HELOC has a variable rate feature, you will describe this in your section 226.5b(d) application disclosure. We do not distribute the RESPA Special Information Booklet to HELOC applicants. The flood notice should be distributed prior to closing.

Return to Top
#30720 - 09/03/02 11:03 PM Re: Home Equity
David Dickinson Offline
10K Club
David Dickinson
Joined: Nov 2000
Posts: 18,762
Central City, NE
Here's an excerpt from our Advance Lending manual on HELOCs:
-----------------------------------------------------------
Home Equity Line Of Credit:
Application disclosure requirements are found in Section 226.5b;
Initial disclosure requirements are found in Section 226.6;
Periodic statement requirements are found in Section 226.7.

1. "When your home is on the line" booklet - must be provided at the time an application is provided to the consumer.

2. Initial program disclosure - must be provided at the time an application is provided to the consumer.

3. Note - different from standard Truth in Lending disclosures (see next page).

4. If the bank follows these rules correctly, the bank does not have to comply with the disclosure requirements of RESPA.

5. Still provide:
a) Right of Rescission Notice;
b) Standard Flood Hazard Determination Form; and
c) Appraisal disclosure or copy of appraisal.

6. Collection of government monitoring information:
• Non-HMDA banks - Do not collect.
• HMDA banks - May optionally collect if some of the proceeds are using for home improvement [Section V.A.5. code 2 of Appendix A of the HMDA].
-----------------------------------------------------------
_________________________
David Dickinson
http://www.bankerscompliance.com

Return to Top

Moderator:  Andy_Z