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HomeFinancial CodeDiv. 1Ch. 3Art. 2§ 327 Mortgage Lending Risk Guidelines

§ 327 Mortgage Lending Risk Guidelines

Financial Code·California
AI Summary·Official Text·Key Terms·Related Statutes·References
AI SummaryVerified

§ 327 Mortgage Lending Risk Guidelines

Key Takeaways

  • •Banks and credit unions must follow special rules to avoid risky home loans.
  • •These rules come from big money groups like the Federal Reserve and FDIC.
  • •The rules help make sure people don’t get loans they can’t pay back.
  • •The state can make new rules fast if needed to keep things safe.

Example

A family wants to buy a house but can barely afford the payments.

The bank must check if the family can really pay the loan back before giving it to them. If the bank doesn’t follow these rules, they can get in trouble.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source
View on CA.gov

§ 327 Mortgage Lending Risk Guidelines

(a) The commissioner shall apply the Interagency Guidance on Nontraditional Mortgage Product Risks issued in September 2006 and the Statement on Subprime Mortgage Lending issued in June 2007 by the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Office of Thrift Supervision, and the National Credit Union Administration to state-regulated financial institutions, including, but not limited to, privately insured, state-chartered credit unions. (b) The commissioner may issue emergency and final regulations to clarify the application of this section as soon as possible. (c) A bank or credit union to which the commissioner applies the documents described in subdivision (a) shall adopt and adhere to policies and procedures that are reasonably intended to achieve the objectives set forth in those documents. (Added by Stats. 2011, Ch. 243, Sec. 2. (SB 664) Effective January 1, 2012.)

Last verified: January 23, 2026

Key Terms

corporationinsurancegovernorcommissionmortgageemergencyregulationsafety

Related Statutes

  • § 508 Emergency Banking Restrictions
  • § 329 Bank Regulatory Provisions
  • § 31021 Business Development Corporation Licensing
  • § 50333 Mortgage Risk Compliance Rules
  • § 23057 Payday Loan Industry Report

References

  • Official text at leginfo.legislature.ca.gov
  • California Legislature. Financial Code. Section 327.
View Official Source