This document is provided pursuant to the provisions of Va. Code Ann. §§ 38.2-233(B) & 38.2-513.1(A)(9) & (D), which basically contains so-called “anti-coercion” disclosures which inform the borrower that they are free to select an insurance agent of their choice, subject to the lender’s reasonable requirements.
The former section applies to credit insurance, while the latter applies to nearly all types of insurances. Since credit insurance is rarely offered by clients using our system, we will be removing the credit insurance disclosures from Cx3577 and will be putting them into a new document (details to follow soon) and, thus, Cx3577 will only be used in connection with property insurance.
To this end, we will be entirely changing the text of Cx3577 so that it will now disclose the following:
“You, the Borrower(s,) have applied for a loan from us, the Lender. Please be aware of the following:
Insurance may be offered or required by us in connection with your loan. You have the right to choose the insurer of such insurances and such choice will not affect our credit decision or the terms of the credit in any way. We may, however, impose reasonable requirements concerning the creditworthiness of the insurer and the scope of coverage chosen, and may disapprove of your choice based on reasonable standards, in accordance with Virginia law.”
The citation on the document will also be changed to “Va. Code Ann. § 38.2-513.1(A)(9) & (D).” We will also be deleting the reference to a loan commitment in the acknowledgment area, since it is superfluous.
These changes will be in effect on March 27, 2014. If you have any questions or concerns about these changes, please contact Client Support at 1.800.497.3584.
March 20, 2014