Question-related to forum post “Requiring deposit acct as condition of loan.”
I am just verifying that it is okay to require the customer to open an account as a condition of the loan. Are there any other restrictions associated with requiring a consumer to open an account as a condition for a loan?
I understand the need to monitor for consistency to avoid Fair Lending and UDAAP violations.
Hypothetical example: Every customer must open or have a deposit account to get a new loan?
A couple of things come to mind:
* – Section 913 of the Electronic Fund Transfers Act prohibits conditioning an extension of credit on the requirement that payments be made by electronic fund transfers.
* – Section 1026.18(r) requires an disclosure that the annual percentage rate does not reflect the effect of the required deposit, if the creditor requires the consumer to maintain a deposit as a condition of the specific transaction.