Most Popular Lending Content
Mayday Payday!
08/01/2003
FDIC has issued examination procedures for payday lending.
New Flood Form Now Mandatory
07/28/2003
by Mary Beth Guard, BOL Guru
Changes in Monitoring Information Collection
07/28/2003
by Mary Beth Guard, BOL Guru
Disclosures: Construction & Permanent Financing
07/21/2003
My bank has a mortgage department (not a separate company) that closes loans in the bank's name, then sells the loan to the secondary market. It is very common for the bank to finance the construction of a personal residence that has been pre-approved for permanent financing through our mortgage department. Our compliance officer advises that since the mortgage department is not a separate company and they close their loans in the bank's name, this type of financing is considered permanent to the bank and we (the bank) should produce GFE's and Early TIL's. We have been disclosing as she advises, but have been disclosing the terms of the construction financing, not the permanent. Now for my question. Is this incorrect? If so, if we disclose permanent terms and the mortgage department discloses permanent terms, isn't this double disclosure? Another issue is that we (the bank) don't always know the terms of the permanent (rate, term, etc.) when the construction financing is processed. Can you offer any guidance on how to handle situations like this?
Does a security interest follow the collateral?
07/21/2003
When financing accounts receivables should the payables be considered when calculating the borrowing base. I am trying to determine if the security interest follows the collateral. For instance if your borrower purchases inventory on an open account and then sells to his customer creating a receivable which he finances with you does the original seller of the inventory have a priority interest?