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#566927 - 06/13/06 08:30 PM Contract for Deed Servicing
nelskent Offline
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Joined: Jun 2006
Posts: 10
Our bank services Contracts for Deeds. These are contracts between a buyer and seller, not loans originated by the bank. When a buyer makes a payment on the Contract for Deed we place the funds in a suspense account and disbusre to the seller the next day. We also do 1099 reporting for both buyer and seller. Would we be required to do CIP verification on both?

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#566928 - 06/13/06 08:59 PM Re: Contract for Deed Servicing
Elwood P. Dowd Offline
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Elwood P. Dowd
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Your bank is serving as the escrow agent, so the CIP Q & A's indicate your customer is the person opening the account; i.e. the seller who leaves the contract for deed with you. As you note, you need the buyer's name, address and SSN for information reporting anyway, but you are not obligated to verify his or her identity.
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#566929 - 06/13/06 09:56 PM Re: Contract for Deed Servicing
nelskent Offline
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Joined: Jun 2006
Posts: 10
Makes sense. Just wasn't sure about doing the CIP on the buyer. Since we are doing IRS reporting for the buyer, I thought that could possibly classify them as a customer.

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