CA Impound Disclosure and Waiver Form - HELOCS

Does the California Impound Disclosure and Waiver form (Pursuant to California Civil Code 2954(a)) pertain to HELOCs, too?

Well, allowing a customer to establish an escrow account in conjunction with a HELOC is highly unusual. But if you allow setting up escrow accounts in conjunction with HELOCs, then it would have to be a voluntary action by the applicants as there are no State or Federal laws or other required escrow account provisions tripped that would require it. In that case, you would need an acknowledgement that it was voluntarily established by the applicant. If you do not offer escrows with HELOCs, then the document becomes a moot point.

I'm with CA regulated FI, and we have designed our HELOC program to avoid the triggers in Civil Code 2954(a) for newly originated HELOCs. If we happen to have a HELOC in first lien position and the borrower doesn't pay their taxes or insurance, then we set up an involuntary escrow but we also restrict the HELOC at time.

Thank you both for the feedback - very helpful!!