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Financing credit insurance prohibition

Home Forums Compliance Masters Group (Members Only) Financing credit insurance prohibition

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  • #2589
    shea930
    Participant

    We can still sell a monthly pay insurance policy but it must be completely seperate from the loan, we can’t escrow for payments or anything right?

    #3105
    jholzknecht
    Keymaster

    A monthly premium is clearly allowed. The borrower’s monthly loan payment would include principal, interest, and the monthly credit insurance premium. The premium would be a pass through item. If you sell a single premium policy the borrower would have to pay the full amount up front.

    #3100
    tparker
    Participant

    Does “dwelling” mean rent houses, mobile homes, etc…or do they mean…”principal dwelling”…Primary Residence?????

    #3096
    jholzknecht
    Keymaster

    A dwelling is a one- to-four-family unit. It may be rental property, but in order for Regulation Z to apply the loan must be for a consumer purpose. A mobile home is a dwelling. When coverage in the regulation targets a principal dwelling the agency drafting the regulations use the term “principal dwelling.”

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