Borrower's Auth. required by law to release p/o?

Posted By: Many Hats

Borrower's Auth. required by law to release p/o? - 07/08/08 06:53 PM

JUST WANTED TO VERIFY IF THERE'S ANYTHING IN FL LAW REGARDING THIS...

A borrower calls and asks us to fax a payoff statement to a title company for her loan. Loan processor told her it's law that we must have a Borrower's Authprization form to release a loan payoff (due to privacy).

1) Is this true? If so, where can I find it documented?

Besides, if a borrower calls and we can verify it's our borrower, can we go ahead and do it?
Posted By: Elwood P. Dowd

Re: Borrower's Auth. required by law to release p/o? - 07/13/08 08:00 PM

The loan processor probably has a "too casual" understanding of the federal privacy regulation (Regulation P if you are supervised by the fed). It says a consumer may not opt out of a discloure made:

Quote:
(1) With the consent or at the direction of the consumer, provided that the consumer has not revoked the consent or direction;


The compliance issue is simply whether you can establish that the consumer authorized the disclosure. A signed authorization form would certainly be one way to do that, but it would not be the only way.