State
Bank & Trust of Seguin, TX
April 19, 2004
RE: EGRPRA -
Review of Consumer Protection Lending Related Rules
Dear Sir:
As a community
banker, I greatly welcome the regulators’ efforts to review
the problems of regulatory burdens on lenders. Community bankers
have worked hard to establish the trust and confidence of our customers.
Many of these regulations increase the costs to the consumer and
slows down the loan process and are a burden to both the consumer
and lenders.
Truth in Lending
- Reg Z
Right of Rescission - Rarely if ever does the consumer exercise this right,
consumers feel it is unnecessary to have to wait to receive loan proceeds,
consumers should be given the right to waive the right of rescission.
Finance Charges
- this definition needs clarification as to what should be included
or excluded from the finance charge, especially in the area of
third party fees. Title company escrow fees have been a gray area
as to whether or not they should be included in the finance charge.
The calculation of the APR needs simplification so that all consumers
can understand the APR and lenders can easily calculate it.
Equal Credit
Opportunity Act - Reg B
This regulation creates a number of compliance problems and burdens on banks.
Knowing when an application has taken place, for instance, is often difficult
because the line between an inquiry and application is not clearly defined.
Home Mortgage
Disclosure Act - HMDA - Reg C
Collecting the data is burdensome for the lenders when reporting rate spreads,
determining the date the interest rate was set on the loan, determining the
physical property address or census tract for rural areas -
Collecting data on the loan application for government monitoring purposes
is hard to obtain from the borrower, consumers do not complete both sections
in many cases. It is unclear in the new revised instructions on how to complete
these sections.
The volume of
the regulatory requirements that banks face today are becoming
a nightmare for community banks. Community banks cannot compete
effectively with the larger national banks and continue to provide
the service our customers expect from us. Thank you for the opportunity
to comment on these issues.
Sincerely,
Diana Allen
Loan Officer
State Bank & Trust of Seguin, TX
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