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Recent Revisions of Reg Z

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Question: 
Two questions related to the recent revisions to Reg Z. 1) Does a business purpose loan partially secured by residential RE now fall under Reg Z? Do you need to have a NMLS license to discuss RE secured products with customers, including abundance of caution liens.
Answer: 

Business purpose loans are still exempt from Reg. Z. See 1026.3 and its Commentary. You will need to go to the SAFE Act and review the definition of a Mortgage Loan Officer and Administrative Duties. Not knowing what these employees will discuss with the consumer makes it impossible for us to answer the question with any authority. You will be in the best position to make that determination after reviewing the definitions.

Abundance of caution liens are not exempt from any regulatory requirements with the exception that there are some appraisal requirements that do not have to be followed.

First published on 04/06/2015

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