Vendor Guru Q&A - Lending

Latest Lending - HELOC Topics

HELOC for Home Construction?

08/06/2020

We have a customer requesting a HELOC instead of a short term construction loan in an attempt to avoid the draws. After construction is complete, a closed end mortgage would be provided. Since there is no equity in the home at this point, because it is not built, are we able to offer a HELOC for their home construction? Also, since they plan to pay off the HELOC at the end of construction, does the requirement for "repeated transactions" apply?

Time Limit to Correct Error on HELOC?

07/12/2020

We have a customer who has a home equity loan. We found that about $8,000 in draws which were not posted to his account from a year ago. His loan is now almost maxed out. Is it too late to charge his account? Is there a time limit to correct our error?

HELOC Access Check to Advance Funds

06/07/2020

If a customer uses a HELOC access check to advance funds, does a transaction description other than "Advance" need to appear on the periodic statement?

Service Provider for Mortgage Loans-HELOC

04/05/2020

XYZ is our service provider for mortgage loans. They are telling us that there is no way to split out the daily interest to only calculate it based on the initial draw at closing. The system is going to calculate interest owed on the total available balance of the HELOC. Our core provider cannot charge prepaid interest on the full amount of a HELOC, just the total of the first advance. So they are both different and it does not seem permissible to charge a customer money on something they have not borrowed yet. Please let me know if XYZ can even accrue on the full amount?

Servicing Disclosure Required on HELOC?

02/16/2020

Is the servicing disclosure required on Home Equity Lines of Credit?

HELOC for Borrower w/PMI Insurance on Mortgage?

09/08/2019

Can a Home Equity Line of Credit be done for a borrower who has PMI insurance on their first mortgage?

Including Taxes/Insurance as Expenses for HELOC

07/28/2019

We know that HELOCs are exempt from 12 CFR 1026.43. Our borrower is applying for a HELOC. He has four residential properties which he owns and is paying the taxes and insurance on these. None of these are his primary residence nor are they investment properties. The taxes and insurance are not on the borrower’s filed tax return . Do we need to include the taxes and insurance for these other non-primary residence real estate properties as expenses when qualifying the borrower for a HELOC?

Rate Change Notice if Prime Increases? HELOC/ARM

05/12/2019

Our HELOCs are tied to prime. We disclose that. If prime increases do we need to send rate change notices?

First Reserve/LOC & HELOC’s as estatement?

03/03/2019

Is there any reason why we are not allowed to have First Reserve/LOC statements and HELOC’s to be estatement?

Info on Notice of Right to Cancel for New HELOC

03/03/2019

The previous Commentary to Reg Z at 1026.5b contained the following statement regarding a matured HELOC: "...A new plan results; however, if the plan is renewed (with or without changes to the terms) after the scheduled expiration. The new plan is subject to all open-end credit rules, including sections 226.5b, 226.6 and 226.15." I have not found any comparable interpretations by the CFPB since the CFPB took over responsibility for Regulation Z. I'm looking for any information that will support the need, or lack thereof, to require a Notice of Right to Cancel when a new HELOC note is executed after the existing HELOC has matured.

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State's Public Records-Record Retention

10/18/2020

We want to know if there is a vendor or website our bank can utilize to quickly retrieve public records online from various Secretary of State offices, tax cards & tax bills to pay escrowed taxes, retrieve recorded real estate docs i.e. recorded Warranty/Quitclaim Deeds, MTG-DOT and AOR's. The majority of states have their records available online but behind a paywall where you have to pay for each individual page of each document. There's 25+ of us between Lending, Legal, and Compliance that need access at our bank to these docs. In my previous banking career, we utilized a website called NETRONLINE.com with a paid subscription but it appears it is no longer available. Is there a substitute?

Transferable Letter of Credit Precautions

10/18/2020

Please explain the precautions which should be used when issuing a transferable letter of credit.

Scanning Before Closing a Commercial Loan

10/18/2020

Why should we consider scanning documents before closing a commercial loan?

Reporting Revenue on Small Business LAR

10/18/2020

When reporting revenue on the small business LAR can you please clarify the following for me: We have a loan program called "Low Doc" in which financials are not used in making the credit decision based on a number of factors, however we do have the revenue information from the customer. In order that these loans are not reported as a code 3 – and not counted in our CRA totals, is it appropriate in using the business revenues that the customer provided?

Switching Exception Tracking Systems

10/11/2020

What steps are involved with switching exception tracking systems?

Latest Lending - HELOC Topics

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