Required Use of NACHA’s Risk Management Portal
Question: Our credit union just received an email from NACHA (National Automated Clearing House Association) that says: Requests for proof of ACH compliance audits will now be automated and distributed to Financial Institutions through NACHA’s Risk Management Portal, and Financial institutions will need to use the Risk Management Portal to respond. I have never […]
CTR: Multiple Transactions vs. Aggregated Transactions
Question: I attended the league’s “Bank Secrecy Act (BSA) for BSA Staff” Compliance Essentials training on August 21st. You spoke about when to check Item 3, “multiple transactions” on a Currency Transaction Report. Can you also explain when we check the Item 24 option “aggregated transactions” on the CTR and how these two items differ? […]
Who Provides the Risk Based Pricing Notice on Indirect Loans?
Question: Our NCUA examiner is stating that in an indirect loan transaction, the credit union is responsible for providing the Risk Based Pricing Notice (RBPN). I was under the impression that the dealer had to provide this notice. Do you know who is responsible? Answer: Let’s look at the requirement from Regulation V: 12 CFR […]
Ability to Repay on Construction Loans
Question: A member wants to build a new home while continuing to live in—and eventually sell—their current residence. When we underwrite construction loans, we always assess the long-term takeout (permanent financing) as part of the approval process. Are there circumstances where we can exclude the member’s current mortgage from the debt ratio calculation, or must […]
Overdraft LOC Fees, MAPR and FCU Rate Cap
Question: We are a Federal Credit Union. We offer an overdraft line of credit tied to members’ checking accounts, with an 18% interest rate. Members can access the line themselves (online, over the phone, or at a branch) without any fees—just the standard interest applies. However, if the system automatically transfers funds from the line […]
Regulation E and Cardholder Negligence
Question: A member reported that their debit card and the PIN were stolen together. They admitted the PIN was either written on the card or kept in the same wallet. There were subsequent unauthorized transactions. Do we need to process a fraud dispute in this case? We don’t see this often, since most members don’t […]
Is Flood Insurance Required if a Flood Map Zone Changes?
Questions: Our life-of-loan flood zone monitoring vendor notified the credit union that a certain member’s property securing his mortgage loan is newly in a flood zone. Is flood insurance required even though there is not a “triggering” event (making, increasing, renewing, or extending a covered loan)? Our member is disputing the new flood zone determination […]
Does the July 1 Reg CC update require a change in terms notice?
Question: Hi Heather. Some questions. Do the upcoming dollar threshold changes to funds availability schedules under Regulation CC require the credit union to provide a change in terms notice to affected members? And if so, is there model change in terms language? Answer: What is Changing? Let’s start out by explaining what is changing. Regulation […]
Reporting Loan Servicer Identity to FEMA
Question: Hi Heather, Our NCUA examiner asked us how we report loans with flood insurance to the FEMA administrator. I wasn’t aware of this requirement, and I couldn’t find any information on FEMA’s website about how to exactly do this. Can you help? Answer: I can help! Let’s start with the requirement from NCUA flood […]