Most Popular Lending Content
RESPA Disclosures Given BEFORE Application
01/19/2004
With respect to a real estate loan, we have a Loan Officer who completed and mailed the RESPA Disclosures prior to application date. They think they should not have to mail out any additional RESPA disclosures after we received the application because they had already been given. I question how they knew what figures to use since there was no application giving them the needed information.
Disclosures of Fees on Commercial Loans
01/19/2004
Our sister bank was told by their examiners that they were in violation for not disclosing fees such as overnight fees on commercial loans. What fees are required to be disclosed in this instance? We typically list the loan fee and flood fee on the note under Additional Charges. What, when, where should we disclose on a commercial transaction (real estate and non-real estate related)?
Charging a Fee for Returned Loan Payments
01/19/2004
We would like to implement a $25 returned payment charge when a loan payment drawn on another institution is returned to us NSF. This charge would cover our costs of reversing the loan payment and sending the NSF check back to the customer. When customers have a deposit account with us, we don't reverse the loan payment if the check is NSF. Instead, we just overdraw their deposit account and the overdraft charge is handled on the deposit side. As we cannot do that with payments drawn on another institution, we would add the $25 returned payment charge to their loan balance(not to the principal). What are the Reg Z or other federal regulation considerations for this? I do not see this specific situation addressed in Reg Z, and did not see anything on the BOL website addressing this either.
Can Bank Stock Be Collateral? -- John M. Floyd & Associates
01/05/2004
Can a national bank make loans for which the collateral is outstanding shares of the bank's stock?
Distinguishing Between Renewal and Refinancing
01/05/2004
We have some confusion distinguishing a renewal note from a refinanced note. At our bank we very seldom "refinance" debt secured by a dwelling. We "renew" the loan, retain original note, mortgage and all other documents, obtain a new promissory note (keep the same loan number) and modify the mortgage to reflet the new terms (i.e. new interest rate and new maturity date.) We refinance when we add new funds. Or, when a construction loan is financed into a permanent loan. We consider our renewal note as an Extension Agreement. How does this relate to the new definition of "refinance"? The word "renew" is no longer in the definition. This becomes important especially for commercial loans secured by a dwelling.