1. For example, an applicant who puts down his home as collateral will have additional information collected for monitoring compliance. Creditors that fail to comply with Reg B will be held liable for punitive damages up to $10,000 in individual actions. You can learn more about the standards we follow in producing accurate, unbiased content in our. Then he added, "I think filling this out is a waste of time—this bank will never loan money on such a risky venture." 3331 et seq. That means any feature that is not related to consumer credit cannot be used when making loan approval decisions.. Reg B outlines the rules that lenders must adhere to when obtaining and processing credit information. He also asks how many children she has and if she plans to have more. A new home appraisal rule just went into effect—the first time in 25 years that “federal regulators have increased the property value limit of the homes that require an appraisal as part of the selling process,” said REALTOR® Magazine. Which statement is accurate regarding this request for information? Mr. and Mrs. Link have applied for a real estate loan with National Bank. 8. This topic has 3 replies, 2 voices, and was last updated 6 years, 5 months ago by rcooper. 9. Tagged: refinance, Reg B, valuation. 12. 2. "Federal Fair Lending Regulations and Statutes: Equal Credit Opportunity (Regulation B)," Page 2. 6. The Reg B appraisal rules are triggered by what event? The effects test is a method to assess the discriminatory impact of credit policies using demographic and statistical data. Optionally, Creditors were allowed to forego notice of the right to receive a copy of appraisal and always provide an appraisal copy. 3. The results are as expected - most creditors are complying with the new rules, but some creditors seemed to be a little confused by the requirements. Which information item is not needed to comply with this requirement? Home › Forums › Equal Credit Opportunity Act/Regulation B › Reg B Appraisal Rules – Esign. Appraisal rules in Regulations B and Z were revised effective January 18, 2014. Federal Reserve. Josh's loan request was denied because his credit score was too low. Based on your understanding of Regulation B, which option correctly lists two instances of age consideration that were legal? Redlining is an unethical and frequently illegal practice that denies loans or services to people living in majority-minority communities. 7. Which option lists possible consequences the bank might be subject to if Carmen sues the bank due to Mark's inappropriate questions? 6. Posts. Which option correctly lists two credit processes covered by the ECOA? 9. Two weeks later Ms. Boyd signs the loan documents and begins her home repairs. However, we are seeing some confusion with the timing requirements, so here is some information that hopefully clarifies the timing. The spouses of rejected married applicants also have the right to this information. The senior loan officer at County Bank has 4 loan applications on his desk. What action must the bank take? "Federal Fair Lending Regulations and Statutes: Equal Credit Opportunity (Regulation B)," Page 1. When Acme Bank sends Rochelle the Regulation B required adverse action notice, what additional information must be included in that notice? You hear a compliance officer express a concern that he may have identified a violation of the Equal Credit Opportunity Act. During the loan interview, Richard expresses concern that Ms. Cooper may not qualify for the loan based on her current income and asks if her husband can cosign the loan. In response to the recent mortgage crisis, Congress amended the Equal Credit Opportunity Act (ECOA) to require creditors to automatically provide applicants with a copy of appraisal reports and valuations prepared in connection with certain mortgage loans. The new appraisal rules are effective for any mortgage loan application received on or after January 18, 2014. 4. The initial final rule was issued in January 2013. Although Rick generally cannot ask for any prohibited information, he can collect certain data from applicants applying for a loan to purchase or refinance their principal dwelling. Which option correctly lists the two methods National Bank should consider? Specifically, it has 1) processed loan payments 2) filed currency transaction reports 3) determined credit evaluation criteria 4) sent thank you letters. 5. Creditors that fail to comply with Regulation B are subject to punitive damages. Which method is the bank most likely using? 81 Fed. The CFPB lists credit transactions and aspects of credit transactions to include consumer credit, business credit, mortgage, and open-end credit. Rick Keenan, a loan officer at RightWay Bank, is meeting with Linda Jones, a retired school administrator. The disclosure of the applicant's right to receive the appraisal must be mailed or delivered no later than what day? Now that the rules have been in place for a year reports of violations are filtering in from examiners and auditors. 3339(3). July 17, 2013 at 3:18 pm #3635. Unfortunately, this rule is not a simple as it may seem, as there are several parts to this rule. By using Investopedia, you accept our, Investopedia requires writers to use primary sources to support their work. Which option correctly lists an activity that is covered by ECOA. Joint intent must be evidenced at the time of application. What Type of Applications are Covered? Has Mark declined the loan? 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