Before an effective lending function can commence, bankers must have a firm understanding of laws and regulations that governed the lending process. Regulatory requirements state what types of records must be obtained and maintained for each loan. During a safety and soundness examination, they will determine if lending practices, procedures and documentation follows the requirements of the major lending regulations.

Proper documentation is essential for the bank to protect its investment and ensure that customers fully understand the loan product they have selected. Failure to properly document loans can leave banks exposed to litigation, losses and costly compliance violation penalties. This course is designed to provide the participant with an overall understanding of the lending regulations to insure loans are in compliance with the law.

Specifically, the course will examine:

Regulation B: Equal Credit Opportunity Act (ECOA)

  • Prohibits discrimination in credit on basis of sex, marital status, race, religion, etc.
  • The impact of Reg. B on the Application Process

Regulation Z: Early Truth in Lending

  • Requires Early Truth in Lending Disclosures which became effective 7/31/09
  • Expanding the Disclosure Requirement Beyond the Principal welling

Regulation X: Real Estate Settlement Procedures Act (RESPA)

  • Covers purchase loans, subordinate liens, closed-end home equity loans, home improvement loans, refinances
  • Review of documentation to include good faith estimate, HUD-1 or HUD1-A statement, settlement costs booklet, transfer of servicing rights, escrow arrangements

Regulation O: Insider Loans

  • Prohibits abuse of a bank by its own insiders
  • Defines insiders as directors, executive officers, principal shareholders (an individual or company that owns, controls, or has the power to vote more than ten percent of the voting stock of the institution), and the “related interests” of same

Regulation U: Securities Credit by Banks

  • If purpose of loan is to purchase or carry and the security is on FRB’s margin list, regulation limits the amount the institution can lend (presently 50% of current market values for securities – FRB can change at any time)

Proposed Interagency Appraisal Guidelines

  • Principal Elements of the Guidelines

Fair Debt Collection Practices Act

  • Designed to curb abusive debt collection practices. Applies only to people attempting to collect debts owned by a third party

Flood Disaster Protection Act

  • Requires flood insurance for mortgage loans if secured property is a flood hazard area in a “participating” community. If in a “non-participating” community, the lender must advise the customer of that fact

Who Should Attend this Seminar?

Anyone involved in the credit granting or credit administration function of the bank including:

  • Board of Directors
  • Consumer Lenders
  • Commercial Lenders
  • Branch Managers
  • Senior or Chief Lending Officers
  • Senior or Chief Credit Officers
  • Loan Review Personnel
  • Compliance Officers
  • Loan Operations Personnel
  • Administrative Assistants to the Lending or Credit Functions
  • Marketing Officer


"Jeffery did a fantastic job all week keeping us engaged in the material and involved. He was a fantastic coordinator & lead professor"

Cliff Knowlton, Prime South

"WONDERFUL!! Great Instructor, great information. Will definitely attend more of Jeffery's classes".

Ansley Oliver, Georgia Commerce Bank

Read more