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#681591 - 02/07/07 01:46 PM Overdraft vs Bounce
Kari Offline
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Kari
Joined: Sep 2002
Posts: 131
PA
Our bank would like to start offering OD Protection via Personal LOCs. What is the difference between bounce and this product and where can I find disclosures or how to even start this from a compliance point??? I am soooooooo confused. Please help.

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General Discussion
#681755 - 02/07/07 03:57 PM Re: Overdraft vs Bounce Kari
Jerod Moyer Offline
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Jerod Moyer
Joined: Oct 2005
Posts: 667
Sioux Falls, SD
Overdraft Protection often refered to as "bounce protection" is covered under Truth in Savings, Regulation DD. The personal line of credit product you are refering to is a loan product and covered by Truth in Lending, Regulation Z. Section 226.5 of Regulation Z outlines the general disclosure requirements for open-end credit:

Section 226.5 of Regulation Z

As far as where to get disclosures, I would contact your provider you are using for other lending related disclosures.
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Jerod Moyer
www.bankerscompliance.com

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#681839 - 02/07/07 04:38 PM Re: Overdraft vs Bounce Jerod Moyer
Kari Offline
100 Club
Kari
Joined: Sep 2002
Posts: 131
PA
Thank you. My IT people are telling me this wasn't bounce. You straightened this out. My research showed the Reg Z but only if we say "we will pay". We are saying "we may pay", because if the LOC isn't high enough, the check will be returned. This is all so confusing. Thanks again for your help

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#682280 - 02/07/07 09:48 PM Re: Overdraft vs Bounce Kari
John Burnett Offline
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John Burnett
Joined: Oct 2000
Posts: 39,684
Cape Cod
No, actually you are saying, "We will pay (up to the limit in your LOC)." That's a commitment to pay, and it makes the LOC subject to Regulation Z.
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John S. Burnett
BankersOnline.com
Fighting for Compliance since 1976
Bankers' Threads User #8

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