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Regulations for business loans

by bikerboy, Performer

  • Created: March 23, 2010, 9:51 pm
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10 comments

I understand that Regulation Z covers consumer loans and offers consumer protections. When it comes to commercial or business loans my state says the normal consumer regulations do not apply. So where can I find the equivalent of Reg. Z for what disclosures are required from a lender when making a business loan? Surely there are some federal guidelines, I just don't seem to be able to find them.

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phanio | Contributor | 3/23/2010 - 9:51 pm

I don't this there is an all inclusive regulation for commercial lending. There are some individual regulations like truth in lending and usury laws. Most government organization think that if you are savvy enough to be in business you are savvy enough to protect yourself. You could find a commercial lender on SCORE (score.org) and ask them the same question.
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bikerboy | Performer | 8/28/2009 - 11:19 am

Phanio, thanks for the reply.  There is certainly a multitude of regulations for consumer loans. Once we enter the commercial side of things it becomes the wild west from what I can tell. I assume there is some overarching US Code that gives a framework for making business loans but I'm struggling to find it.   I will try the Score site, thanks for that suggestion.

bikerboy | Performer | 3/23/2010 - 9:51 pm

Phanio, thanks for the reply.  There is certainly a multitude of regulations for consumer loans. Once we enter the commercial side of things it becomes the wild west from what I can tell. I assume there is some overarching US Code that gives a framework for making business loans but I'm struggling to find it.   I will try the Score site, thanks for that suggestion.

JamesSimon | Window Shopper | 1/6/2010 - 1:23 am

I think, lending on Private Companies are more, say, loose on their restrictions. Try a couple of banks around your area, and see through their contracts. goodluck! -- cheers James I am a part-time Ad Banner Creator, and here's samples of my works: helicopter simulator download flightprosim review Message Edited by JamesSimon on 01-06-2010 01:27 AM Message Edited by ChristineL on 01-06-2010 11:56 AM
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phanio | Contributor | 8/28/2009 - 9:32 am

I don't this there is an all inclusive regulation for commercial lending. There are some individual regulations like truth in lending and usury laws. Most government organization think that if you are savvy enough to be in business you are savvy enough to protect yourself. You could find a commercial lender on SCORE (score.org) and ask them the same question.

VMD | Performer | 12/9/2009 - 7:59 am

Bikerboy, did you find any good answers? I have the same question.

bikerboy | Performer | 12/9/2009 - 1:50 pm

I never did find a specific regulation(s) in the US Code. I may have to break down and try and call the FTC and see if they can point me toward some specifics.   Good luck with your search.

BizResearcher | Window Shopper | 1/6/2010 - 12:03 pm

I did a brief search. It appears that where the bank is chartered has some effect on their lending practices. Banks can be federally or state chartered. And then you have credit unions, which can also be federally or state chartered. You might choose a bank you are interested in and then find out whether they are a state or community bank or a federal one, then check the regulating organization's guidelines. At the state level it should be your state department of finance or its equivalent. State banks and credit unions usually have a board of directors, which sets some of their lending policies. The board can set standards more stringent that state and federal laws, but not less stringent. Message Edited by BizResearcher on 01-06-2010 12:06 PM

bikerboy | Performer | 1/6/2010 - 12:28 pm

Since starting this thread I have found a friendly banker and got a bit more information regarding regs for commercial loans.  In the state I live in the state does not regulate these loans. The banker I spoke to essentially said that everything is negotiable when it comes to fees, terms, rates, etc. He said it is one of the reasons he prefers doing commercial as it allows him to make more profitable deals and not have the headaches that go along with consumer loans.    

ChristineL | Former Moderator | 1/7/2010 - 11:49 am

Thanks for coming back and letting us know!