I just want to confirm that the “we intend to apply for joint credit" verbiage must be on the applications to comply with Reg B?
Our applications state "What type of credit are you requesting?" then the applicant(s) initial if they check the joint credit box. The information I have read on Reg B says a person's intent to be a joint applicant must be evidenced at the time of application. Signatures on a promissory note may not be used to show intent to apply for joint credit. On the other hand, signatures or initials on a credit application affirming applicants' intent to apply for joint credit may be used to establish intent to apply for joint credit. The method used to establish intent must be distinct from the means used by individuals to affirm the accuracy of information. For example, signatures on a joint financial statement affirming the veracity of information are not sufficient to establish intent to apply for joint credit.
If we want to provide notices of incompleteness and/or adverse action notices to commercial loan customers electronically. Am I correct in understanding we only need to obtain demonstrable evidence they have consented to receiving such notification electronically?
Adverse Action Webinar - June 21, 2017 - David Dickinson
I wanted to confirm. David Dickinson said in a recent webinar that if a consumer comes into the bank to inquire about a loan and we know from the initial conversation they will not qualify and after explaining our basic underwriting guidelines we can provide them with an adverse action notice on the spot. We would no have pulled credit. We would not have discouraged them from applying.
Would we use form C-1 to provide the notice?
We would of course keep any documentation with the notice for retention and Fair Lending audits and risk assessments. We would also provide training to our LO's and provide them basic scripts.
Am I on the right track?
I wanted to find out if the following would be viewed by a regulator as being in violation of Reg B:
We buy dealer paper and part of the closed loan packet we receive from the dealer is a photocopy of the applicant's ID, the photo ID was not utilized by the bank to make a credit decision. Would this be a violation as the regulation states the following: "To the extent the institution maintains any information in its files that is prohibited by the ECOA or Reg B for use in evaluating applications, that information may be retained if it was obtained (a) prior to March 23, 1977; (b) from consumer reporting agencies, an applicant, or others without the specific request of the creditor; or (c) as required to monitor compliance with the ECOA and Regulation B or other federal or state statutes or regulations. (12 CFR 1002.12(a))."
If one person owns the house and is not married but both parties apply for a mortgage, who signs the mortgage?
Pre-qualification application received Refer/Eligible Findings from GUS - Rural Development for a purchase of a primary residence loan. The loan could potentially be manually underwritten for approval if the borrower were to provide the documentation. Borrower chooses to not go manual underwrite and says cancel my file. Is the loan Denied based on the GUS refer findings or is it approved/not accepted on the hypothetical possibility that it may have been able to be manually underwritten?
A customer completed a consumer application to refinance their vehicle. The lender did not run a credit report because after interviewing the borrower and running a value on the vehicle she determined the borrower did not have sufficient equity to refinance. She only has 'insufficient collateral' as a reason. A senior lender is telling her she needs to have two reasons and must run a credit report. Is there a regulatory requirement for two reasons or that a credit report MUST be run in order to give an adverse action?
Are we correct that we do not have to send an adverse action notice in the event we freeze a HELOC for “inactivity, default, or delinquency” of the account? Do we need to send a notice to restrict credit? If so, is there sample language? We have not been able to find an example of this notice.
(c)Change in terms -
(1)Rules affecting home-equity plans -
(i)Written notice required. For home-equity plans subject to the requirements of § 1026.40, whenever any term required to be disclosed under § 1026.6(a) is changed or the required minimum periodic payment is increased, the
creditor shall mail or deliver written notice of the change to each consumer who may be affected. The notice shall be mailed or delivered at least 15 days prior to the effective date of the change. The 15-day timing requirement does not apply if the change has been agreed to by the consumer; the notice shall be given, however, before the effective date of the change.
(ii)Notice not required. For home-equity plans subject to the requirements of § 1026.40, a creditor is not required to provide notice under this section when the change involves a reduction of any component of a finance or other charge or when the change results from an agreement involving a court proceeding.
(iii)Notice to restrict credit. For home-equity plans subject to the requirements of § 1026.40, if the creditor prohibits additional extensions of credit or reduces the credit limit pursuant to § 1026.40(f)(3)(i) or (f)(3)(vi), the creditor shall mail or deliver written notice of the action to each consumer who will be affected. The notice must be provided not later than three business days after the action is taken and shall contain specific reasons for the action. If the creditor requires the consumer to request reinstatement of credit privileges, the notice also shall state that fact.
In 1026.37(f)(5) we know that creditors are required to use terminology that is reasonably understood by consumers. We lend in Indiana in which the Title Company will charge a $5 TIEFF fee. This is an acronym for Title Insurance Enforcement Fund Fee, but it is recognized as TIEFF in the industry and is searchable on the web as TIEFF.
We have an investor who is requiring the full name be placed on the CD for all IN loans versus the TIEFF acronym. We feel that the acronym is reasonably understood. The problem with using the full fee name is that it would always require an addendum due to the character limitations on the CD.
Has anyone else run up against this scenario and have overcome the investors' concerns?
Do Reg B requirements apply when taking a "new" application to renew an existing loan?
If the existing customer has already been identified through CIP and we have address/contact/employment information on file already, does Reg B require that we read the standard application disclosures again at time of renewal and is it a regulatory requirement to update driver license expiration, as well as get all new income information, etc. ?
I know we need income information for ability to repay and my understanding is that once they go through the CIP process, we don't have to identify them with each subsequent transaction but in general what are the
regulatory requirements on a renewal application?