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?
What should be a financial institution's main considerations/conditions for lending to a start-up business for processing hemp? How does an institution
perfect a security interest in the raw material/and or crude? If the institution has to take possession for some reason, what would be the
recourse? Can the financial institution sell the inventory to another hemp processor?
What is the difference between an enforcement action and a consent decree?
Our borrower routinely said it was OK to text them and we have that screen capture in our records. Can I contact them now to collect the debt via text messages?
Credit Bureaus are now allowing consumers to "self-report" utility accounts on their credit histories. These accounts show as payments and performance
does affect their credit scores. For ATR compliance, should these reported accounts now be considered in DTI calculations or can they be excluded? As
a side note, I am seeing automated software pulling these utility accounts into the calculations as any other credit account.
I am doing some research around E-SIGN and its applicability to both compliance and the law. While I know we have members in different states, and each state is different and any case law or state law, mentioned may not be binding in our "home" state, I would still be interested in how other jurisdictions are handling this.
What is your take on courts requesting original signature cards? We have an in-house collections department, that will go to court to file judgement on charged-off checking accounts or past due loans. In our local courthouse a certain judge has often asked our collections manager for the original signature card, when she is trying to obtain judgement. At our bank, customer signature cards can be obtained a number of different ways. The most common is via a digital topaz screen (electronic screen that the customer physically signs when they open a new account). There are some situations however where the customer can not come to the branch and sign, so we will go to the customer and have them sign a “wet” signature paper form, and then we come back to the branch and scan that paper form to our customer accounts team.
I am trying to find out if that scanned wet signature will hold up in court as an original (since after it is scanned we destroy the paper copy). Additionally we have circumstances when the customer is out of area, or someone is opening a joint account where only one party is present in the branch and we send out the signature form electronically to the other party via email and they “remote E-sign” via a digital signature (which is just a printed version of their name). I am wondering if these will hold up in court?
Furthermore, have you ever seen where a bank will allow customers to completely doc-u-sign/ remote E-SIGN a loan application and all associated closing documents? Even the big players in this space (Rocket mortgage, Quicken loans) usually send a mobile Notary once all the paperwork is completed to come meet with you and obtain a wet signature on the paperwork.
Our mortgage department has asked if instead of that wet signature at closing if an electronic signature would suffice in the courts. What about Deeds of Trust, can they have electronic signatures?
I really appreciate your help or any insight you can provide via your years in banking. If you find or know of any relevant case law please let me know as that would certainly help in my analysis.
We are trying to make a loan to a new entity and provide a short term line of credit to help fund the costs of there first contract as a company. We
are wanting to take an assignment of the contract and have their customer issue joint checks for their payouts. I have been unable to find any
document that works on our compliance software. Any ideas of how I would perfect this transaction?
If two separate, unrelated banks have a mutual customer that is engaging in an unrelated loan at each bank that is NOT a participation loan, can one
bank rely on the other bank's beneficial ownership efforts? Again, there is no relation between the two banks or the loan being conducted, the only
common denominator is the each bank is working on a loan for the same legal entity. We have a situation to where the legal entity's beneficial owner
does not want to supply his information to us as he already provided it to the other bank that is working on a separate loan for him. It was basically
suggested for us to ask the other bank for the beneficial owner information. It is also being suggested that this falls under the reliance provision
listed below. I am thinking it does not as there is nothing connecting us to the other bank or the loan they are working on.
(j)Reliance on another financial institution. A covered financial institution may rely on the performance by another financial institution
(including an affiliate) of the requirements of this section with respect to any legal entity customer of the covered financial institution that is
opening, or has opened, an account or has established a similar business relationship with the other financial institution to provide or engage in
services, dealings, or other financial transactions, provided that: (1) Such reliance is reasonable under the circumstances;
(2) The other financial institution is subject to a rule implementing 31 U.S.C. 5318(h) and is regulated by a Federal functional regulator; and
(3) The other financial institution enters into a contract requiring it to certify annually to the covered financial institution that it has
implemented its anti-money laundering program, and that it will perform (or its agent will perform) the specified requirements of the covered financial
institution's procedures to comply with the requirements of this section
We received a referral for a commercial construction loan from a small business that specializes in providing information to those who are building
homes. The construction loan does not meet any of the triggers for RESPA coverage. The referring source is requesting a 1% referral fee. The bank
would pass this fee onto the borrower. My questions are: (1) Are there any regulatory or legal prohibitions on the bank paying this fee and passing it
onto the borrower, and (2) if the fee is permissible, how should it be listed on the loan documentation?
Our bank has a 3% ownership interest in a title company and we provide an affiliated business arrangement disclosure on all loans. Should fees paid to the affiliated title company be included in the Qualified Mortgage points and fees test and/or the APR calculation?