This question has been asked by our Closing Manger...was wondering if anybody could give some clarification please:
We sell loans on secondary market and have portfolio loans. We are federally charted bank. We have had an investor come back and say that in the Alabama Mini code 5-19-4a, that the late payment for loans in Alabama should be 5% or $18, whichever is greater a max of $100. Whereas on Fannie/Freddie late fee is 5% unless mandatory by state law. We deal with 4 other investors and have a document company who states that because the mini code in Alabama states "may", that this means it is not mandatory therefore the standard 5% should be on the note, TIL in order to sell to them. We also agree with this. However would like some opinion on what other banks that sell on the secondary market do and if our bank loans should follow the Alabama Mini Code.
Trust in the Lord with ALL your heart...Prov 3:5-6