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FDIC Federal Register Citations






From: Sharon Moorhead [mailto:SMoorhead@sharonbank.com]
Sent: Monday, April 19, 2004 11:25 AM
To: Comments
Subject: EGRPRA Review of Consumer Protection Lending Related Rules

Sharon Moorhead
9 Chester Pike
Darby, PA 19023


April 19, 2004

Dear FDIC:

April 8, 2004
Dear Sir or Madam,

As a community banker at an institution w/$200MM in assets, I appreciate
the regulator’s efforts to address our mutual burden. Community banks
continue to fulfill an important role for consumers and small businesses
in today’s financial services arena. Often competing with megabanks and
their mega resources, the limited human resources of community banks
struggle to juggle the ever increasing demands of regulatory and
technological change.

We are traditional in our loan product offering...pretty much plain
vanilla fixed or adjustable purchase or refinance mortgages and fixed or
adjustable rate home equity loans and lines of credit. Referring back to
our asset size, it is a Herculean task to remain cognizant of current and
pending regulatory issues and their effective implementation. With the
revised HMDA and the addition of some consumer loans subject to
government monitoring, another burdensome task has been necessitated. As
we really don't have any more ‘ hats to wear’ , we are currently
contemplating the most effective way for us to comply with the recording
of HMDA data and HOEPA assessment . This would not be an issue for us if
the threshold were increased to banks with assets > $250MM.

Regarding Reg Z, I relish this opportunity to comment on two issues. First
of all, I have always found that the APR is so contradictory to the very
nature of the Truth in Lending Act. When I started by Banking career in
the early eighties, TIL was explained to me as EZ. The idea that
disclosures were to be designed so that consumers could easily compare
loan products and that Notes should clearly display finance charges and
rates, etc. In my experience, I have never heard even a seasoned Lender
satisfactorily explain the APR calculation to an inquiring consumer.
Additionally, lets face it, often times the APR can be (un)intentionally
distorted. Any regular “ Joe” will appreciate the actual rate and the Good
Faith Estimate of Closing Costs as comparative tools and question
suspiciously the APR.

My second comment regarding Reg Z concerns the Right of Rescission. I
advocate the right of consumers to have a period of time to review loan
documents privately at their leisure and furthermore to have the right to
cancel. Predatory lenders make this consumer protection well deserved.
What is overkill about the ROR is the three day period. The consumers of
this world disdain the wait often begging the Lender to accept a consumer
request to waive the rescission period. I propose a compromise wherein the
next business day (perhaps by 11:00 am) is a sufficient period of time
for document examination and rescission contemplation.

Thank you for this opportunity to share some personal observations and
suggestions. Best of luck with your charge.

Sincerely Yours,
Sharon B. Moorhead


Last Updated 04/27/2004 regs@fdic.gov

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