Our loan officers pull clients credit reports and input the information in our LOS. Not all six items that make up an application for a home loan have been provided. My question is, do we still send out a "Notice of Incompleteness" to the client if the only thing that was received in the loan file was the credit report and the loan has been in our system for 30 days with the property marked, "TBD?" The way I read Reg B is that you only send out the NOI once it is considered an application. So if these are not considered an application but you obtained credit, would we not have to send some sort of documentation/NOI because the score is good enough to move forward?
We received notice on Oct. 28 that a borrower was now in flood zone AE. A 45 day notice was sent (force placement would have occurred on Dec. 13). On Dec. 12 we received a copy of a declaration page showing coverage starting effective Jan. 12. I believe we need to force place and then cancel on Jan. 12 at the borrower's expense however I'm getting push back because of a claim of evidence of insurance (again, the policy is not effective until Jan. 12). The declaration page shows payment in full however we do not have an application nor proof of payment. Do we need to force place this interim period?
For a home improvement loan, is the Purpose = Home Equity?
We received a complaint from an account holder who used their credit card to purchase a trip on 7/3/18 for over $2,600 from a travel company. He provided evidence to us on 8/11/18 that the travel company had closed and the trip would not be offered and there would be no refund for what he had paid. The information he was provided from the travel company said the purchase was non-refundable and he had not purchased trip cancellation protection. He filed a dispute with us on 8/11/18 asking for credit for the cost of the trip. He did not make any payments on the account between 7/3/18 and 8/11/18, so it seems to me he would have a valid claim under both Reg. Z 1026.12 and 1026.13 (since he didn't/isn't going to receive the services he paid for and he filed his dispute within 60 days of the date of the statement the charge appeared on and he had not paid for the charge before he filed his dispute. Our bank's disputes department declined his claim, so he filed subsequent disputes, but was told each time that he was not entitled to a credit. I work in Complaints, which is where this claim has now landed, and I believe we need to credit him for the purchase. Is my thinking correct?
This question has come up before but I have not seen a clear answer. If the application is NOT taken face to face, how should the collection method questions be answered for HMDA? Code 3 (NA) is only supposed to be for applications where the requirement to report the data does not apply to the covered loan. We would use code 3 on applications where it is an entity. Code 2 (not based on visual observation) would be the only choice that would make sense. What are your thoughts?