Feds weigh in on home equity drought

The national wave of cancelled home equity lines of credit has prompted the Office of Thrift Supervision to remind banks in Florida and elsewhere that they must meet federal guidelines when they cancel these types of loans. For example, with limited exceptions, Regulation Z of the Truth in Lending Act prohibits creditors from terminating a home equity line of credit and then accelerating repayment of the outstanding balance. Information about the laws governing home equity lines of credit is available at www.ots.treas.gov.