ESSENTIAL LENDING COMPLIANCE

This program is a must for those wanting to learn about or review the major provisions in the lending compliance world!

As financial institutions wade though Federal compliance laws and regulations, we consistently come back to certain provisions.  There are a number of rules that apply to many types of transactions or in many circumstances, while others only apply occasionally.

This seminar provides an in-depth and concentrated review of the Federal lending rules that are the most common and prevalent, both for consumer and business loans. Given that employees do not have an unlimited amount of time to learn about these rules, it’s important that training cover enough fundamental requirements, especially disclosures, in order for employees to have a better understanding of what they’re supposed to be doing and why they’re doing it.

This seminar is for those that are constrained with their time, but still need to review rules and disclosures that are commonly required. We will provide a focused examination of Federal laws and regulations that are central to our daily compliance requirements.

HERE IS WHAT YOU'LL LEARN

• EQUAL CREDIT OPPORTUNITY ACT
  • Definitions
  • Signatures
  • Notification/Adverse Actions
  • Appraisal
  • GMI
• FAIR CREDIT REPORTING ACT
  • Permissible Purpose
  • Disclosures
• TRUTH-IN-LENDING ACT
  • Coverage
  • TIL Statement; TRID
  • ATR/QM: HPML
  • Open-end; HELOCs
  • Right of Rescission 
• REAL ESTATE SETTLEMENT PROCEDURES ACT
  • Disclosures
  • Escrow
  • Force-Placement
• FLOOD DISASTER PROTECTION ACT
  • Determination
  • Notice
  • Amount Required
  • Escrow
• MILITARY LENDING ACT
  • Coverage
  • Identification
  • Overview of Rules

WHO SHOULD ATTEND
This program is suitable for all personnel involved in the lending process – compliance officers, auditors, loan officers, loan processors, mortgage brokers, closing staff/ settlement agents – who will find the targeted approach of the seminar helpful in learning about and reviewing key requirements.

Program Level: Intermediate
Prerequisite: Basic Knowledge of Lending Regulations
Advanced Preparation: None
Delivery Method: Group Internet Based
Field of Study: Specialized Knowledge

Appraisal Regulations
To help ensure the creditor receives all debts owed to it from the borrower, loans may be secured by property, to allow the creditor to force it’s sale in the case of borrower default. The valuation of that property, accordingly, is crucial in ensuring the creditor is made whole. These valuations may be in the form of an appraisal or an evaluation, which are an integral part of the lending process.

Several rules regulate two basic parts of this process: One, the institution’s process of ordering, obtaining, and reviewing an appraisal or evaluation, and the importance of the independence of the person performing the appraisal or evaluation; Two, when appraisals are required and providing a copy to the borrower.

The Appraisal Regulations, and corresponding Interagency Guidance on Appraisals and Evaluations, establish the cornerstone of these requirements, while other rules are found under the Truth-in-Lending/Regulation Z (the valuation independence and higher-priced mortgage loan (section 35) rules) and Equal Credit Opportunity Act/Regulation B (appraisal notice and copy rules).

This three-hour program will discuss the Interagency Appraisal and Evaluation Guidelines in detail and provide an overview of the compliance rules under the Truth-in-Lending and Equal Credit Opportunity Act.

HERE IS WHAT YOU WILL LEARN:

• An in-depth review of the Appraisal Regulations and Interagency Guidance, which will cover:
  • The appraisal management program
  • Selecting appraisals
  • Ordering and reviewing appraisals
  • When an appraisal or evaluation is required
  • Evaluation standards
• Review of other appraisal rules:
  • Truth-in-Lending Act/Reg Z – valuation independence and higher-priced mortgage loans (section 35)
  • Equal Credit Opportunity Act/Reg B
• Other agency bulletins and statements
• A brief overview of USPAP
   

Flood Insurance Compliance
The flood insurance regulation is a compliance topic that is often a source of confusion and anxiety, as requirements are frequently vague and violations may devolve into civil money penalties.  We also struggle with insurance companies/agents and with business/commercial lenders who push back at the requirements.  Institutions must be aware of the breadth of the flood insurance requirements and the potential pitfalls they may face. 

This three-hour session will provide a review of the fundamental obligations that financial institutions have with complying with the flood regulations, including: making the determination of whether flood insurance is required, notification requirements, when and how much insurance is required, force-placement, the detached structure exemption, escrow, and notice requirements. We will also discuss issues that are more complicated and confusing, such as what "insurable" value is and how it is calculated, residential condominium building associations, multiple buildings, and the private flood insurance requirements.

The discussion and materials will incorporate the regulations and the ever-important Interagency Q&As, as well as certain portions of FEMA's Flood Insurance Manual.

HERE IS WHAT YOU WILL LEARN:

• When the institution must make a flood determination and when it can rely on a previous determination;
• When notice must be provided, and what the notice must include;
• Calculation of required insurance
• What is insurable value?
• Multiple buildings; Contents coverage
• HELOCs; Subordinate liens
• Residential Condominium Assoc Policies (determining sufficiency)
• LODR/LOMA/LOMR
• Detached structure exemption;
• What type of evidence is sufficient;
• How to resolve discrepancies;
• Escrow requirements;
• Force-placement;
• Private flood insurance;
• Civil money penalties.

Third Party Risk Management

Competition, advances in technology, and innovation in the financial services industry contribute to institutions’ increasing use of third parties to perform business functions, deliver support services, facilitate providing new products and services, or facilitate providing existing products and services in new ways. As such, a strong Third-Party Risk Management (TPRM) framework that incorporates and promotes sound risk management principles and compliance with all applicable laws and regulations is essential.

The federal prudential regulators (FDIC, FRB and OCC) have issued final joint guidance to promote consistency in their approach to third-party risk management and to clearly articulate risk-based principles on third-party risk management.

• Third-Party relationship types and levels of risk
• Interagency Third-Party Risk Management Life Cycle
• TPRM Framework
  • Developing a plan that outlines the institution’s strategy, identifies the inherent risks of the activity with the third party, and details how the banking organization will identify, assess, select, and oversee the third party;
  • Performing proper due diligence in selecting a third party;
  • Negotiating written contracts that articulate the rights and responsibilities of all parties;
  • Board of directors and management oversight of the institution’s risk management processes, maintaining documentation and reporting for oversight accountability, and engaging in independent reviews;
  • Conducting ongoing monitoring of the third party’s activities and performance; and
  • Developing contingency plans for terminating the relationship in an effective manner
• Third-party compliance requirements and expectations from a compliance perspective

Environmental, Social and Governance (ESG)

Environmental, social and governance risks are producing heightened expectations for financial institutions. Although the prudential regulators have focused predominantly on climate change, each principle has an impact on our financial system. The impact of ESG concerns not only stem within the institution but also stem from the institution’s customers and their customers.

During this session, we will lay the foundation of ESG principles and practices and explore why institutions are integrating ESG into their strategic priorities. We will highlight key considerations leveraging recent annual ESG reports issued by various banks.

• Define ESG
• Key ESG issues, risks and opportunities
• Stakeholder and customer influence on corporate ESG performance
• Assess ESG performance
• Getting started with ESG

Instructor:
Natalie Strauss 
ProBank powered by Forvis 


Who should attend

Board, senior management, compliance, BSA, audit, risk officers, legal and operations staff members who interact with third parties providing services for the institution will benefit from these sessions.

Program Level: Beginner/Intermediate Prerequisite/Advanced Preparation: Basic understanding of banking

Field of Study: Specialized Knowledge