We would strongly advise against inserting a clause stating that the bank would serve only the customer’s attorney into consumer loan contracts. While there are no specific legal prohibitions on such a clause, it could raise any number of issues for the bank. For example, it may be viewed as unfairly interposing an intermediary for communications that should be made directly to the customer. This could raise UDAAP concerns and could be viewed as a failure to properly serve the customer.
We have inserted an “attorney service clause” into our commercial loan agreements, which allows us to serve a company’s attorney instead of servicing the company personally. Do you see any problems with inserting a similar provision in our consumer loan agreements?
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