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#1989422 - 01/16/15 07:59 PM Loan Modifications
violet Offline
Junior Member
violet
Joined: Aug 2012
Posts: 31
Please advise:
Are there ATR or UDAAP issues to be concerned about with Loan Modifications (let's assume no new note or credit line agreement - so no new disclosures) ? These are customer requested, NOT workout modifications.
Can we order an updated credit report or ask for current paystubs for modifications without performing entire ATR analysis? Is there a "trigger"?
And, is it correct to say, if previous Flood Determination is no older than 7 years, we can provide copy of the one already on file?
Appreciate any feedback or reference to specific section in Regs.

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Lending Compliance
#1989439 - 01/16/15 08:22 PM Re: Loan Modifications violet
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
If these are customer requests, you can use whatever non-discriminatory criteria that you wish in deciding whether to grant or not grant the request.

If it involves increasing or extending the loan, then you could re-use a FHD but would have to provide a new notice to borrower if they are in a SFHA.
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#1989473 - 01/16/15 09:24 PM Re: Loan Modifications rlcarey
Juulzgs Offline
New Poster
Joined: Jun 2013
Posts: 5
Florida
may seem silly but what is a FHD?

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#1989475 - 01/16/15 09:28 PM Re: Loan Modifications violet
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
Flood Hazard Determinaiton
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The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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#1989481 - 01/16/15 09:42 PM Re: Loan Modifications violet
violet Offline
Junior Member
violet
Joined: Aug 2012
Posts: 31
Our concern is: if we pull a credit report for a Mod, and Management declines Mod request, would this be considered an application and therefore, actually be a Refi program?

If Mod was declined, would adverse action be required? Would that mean we are making credit decision, triggering disclosures etc?

thanks again.

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#1989495 - 01/16/15 10:06 PM Re: Loan Modifications violet
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 83,219
Galveston, TX
Depends on what the request was for. More money - that would be an application for additional credit. It is sort of a case by case basis. But if you are not triggering a refinance under 1026.20, then no RESPA or TIL disclosures would be required. If you were extending the loan, a new flood notice would be required if the property was in a SFHA regardless of how you classified the transaction.

You really can't talk to much in generalities as some of this would be transaction and regulation specific.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

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