HELOC Early Program Disclosures

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    Our bank pays all 3rd party fees for HELOCs $250,000 and up. For lines over $250,000 we charge the customer for the 3rd party fees. Would it be acceptable to state a range of fees from $0 to $X,XXX since the fee would depend on the HELOC amount? If not, would there be a way to do this but still use only 1 HELOC program disclosure, or would this require 2 different ones?


    Even if it is a separate plan, according to the commentary, you can provide it on one disclosure. See the language from the commentary below.

    1026.40(a)(1)-4. Method of providing disclosures. A creditor may provide a single disclosure form for all of its home equity plans, as long as the disclosure describes all aspects of the plans. For example, if the creditor offers several payment options, all such options must be disclosed. (See, however, the commentary to §1026.40(d)(5)(iii) and (d)(12) (x) and (xi) for disclosure requirements relating to these provisions.) If any aspects of a plan are linked together, the creditor must disclose clearly the relationship of the terms to each other. For example, if the consumer can only obtain a particular payment option in conjunction with a certain variable-rate feature, this fact must be disclosed. A creditor has the option of providing separate disclosure forms for multiple options or variations in features. For example, a creditor that offers different payment options for the draw period may prepare separate disclosure forms for the two payment options. A creditor using this alternative, however, must include a statement on each disclosure form that the consumer should ask about the creditor’s other home equity programs. (This disclosure is required only for those programs available generally to the public. Thus, if the only other programs available are employee preferred-rate plans, for example, the creditor would not have to provide this statement.) A creditor that receives a request for information about other available programs must provide the additional disclosures as soon as reasonably possible.

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