NCUA: Interagency Guidance on HELOCs Nearing Their End-of-Draw Periods (7/7/2014)

The NCUA, along with other federal regulatory agencies, released guidance for financial institutions as home equity lines of credit (HELOCs) near their end-of-draw periods, which occurs when the principal amount of the HELOC must begin to be repaid.  During this period credit unions may face challenges as borrowers can find it difficult to make higher payments or to refinance their existing loans due to changes in their financial circumstances or declines in property values.  The guidance discusses how credit unions can work together with their borrowers, and how they can effectively manage the risk involved in these circumstances.