From: Schoenbucher
Karen
Sent: Wednesday, February 25, 2004 2:30 PM
To: regs.comments@federalreserve.gov; Comments; regs.comments@occ.treas.gov;
regs.comments@ots.treas.gov
Subject: EGRPRA
I would like to take this opportunity to comment on three of my
favorite regulations.
HMDA Reg C has always been fun & challenging. I've had lots
of interesting experiences with it, but thought I'd finally gotten
it down pat. Well then along came HOEPA & the Rate Spread.
I found it almost too much to believe when the 4th item in the
training package (St Louis Fed) under the Goals said "Clarify & simplify
the rule." To me, nothing could be further from the truth.
How & to what type of loan HOEPA applies to soooo confusing!
We're trying to build a road map to follow this one. It would have
been easier to ask the question "Do you sell or add Credit
Life Ins to this loan" and give an answer! As for the Rate
Spread, I think if you'd simply asked for either the stated interest
rate & APR or the APR only, that would have been more meaningful
than trying to again figure out what loans this applies to & to
compare the APR to a Treasury Security Rate. This may mean something
to someone somewhere, but we're at a loss on our end.
TIL Reg Z is sometimes confusing to most people because we feel
that all most customers want to know is "What's my interest
rate and monthly payment amount?" The components of what goes
into making up the APR calculation should or could be simplified
if someone could come up with an updated chart from the original
that Alan Dombrow first created (see my attachment which may not
be all inclusive) that would just spell out what is & is not
included in the APR & Finance Charges. We've been dealing with
this for some years now, and it's time to lay all the cards out
on the table & get everyone on the same page. I cannot answer
a question about these two items without referring either to Alan's
chart or my own.
And on a related matter, RESPA & the HUD-1. I've read all about
HUD's proposal to make changes & all I can say is Heaven help
us all if their ideas get approved. It is hard enough to get a
realistic picture out to the customer in 3 days, let alone have
that become a contract for fees to be paid at closing. The GFE
is just that, an "Estimate" of the costs. But things
change all the time, and to make one estimate a contract is unrealistic.
The GFE & early TIL should be an estimate based only of the
facts known at the time of application. And please don't review
the final HUD-1 to the GFE, too many variables come into play and
as I said, things change between the time an application is taken & the
loan closes.
Thanks for letting me put in my two cents worth. Karen
Karen A. Schoenbucher
V P & Compliance Officer
Southwest Bank, Ft Worth, Tx
