Reg Z Reimbursement Procedures

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Question:

We have some consumer loans where the customer did not sign for credit life insurance so we treated the premium as a prepaid finance charge and completed an APR calculation. Can the reimbursement be credited to their loan or does the reimbursement need to be paid directly to the customer? Is there a time frame after we discover the error and if so, where does it state the time frame in the regulation?

Answer:

Here's a FDIC document that will help to guide you. You should also review Section 130(b).

First published on BankersOnline.com 4/06/09