N.C. Gen. Stat. §24-10.2(c) prohibits a lender from “flipping” a consumer home loan. “Flipping” is the act of making a consumer home loan that refinances a previous consumer home loan when the new loan does not have a reasonable, tangible net benefit to the borrower.
We have been providing Cx2031 (NC Refinance – Statement of Borrower Benefits) as a generic disclosure for loans in North Carolina in order to help lenders provide evidence that they took into consideration the benefits that a borrower will receive in refinancing a consumer home loan.
Although this document has served this purpose well, we will be using instead, as a new generic form, Cx12531 (Tangible Net Benefit Worksheet) which provides more detailed information about the benefits that the borrower will be receiving.
August 1, 2011