HVBC 2016 Annual Report

10 viability of the project being financed. We generally require appraisals of all real property securing loans. Appraisals are performed by independent licensed appraisers who are approved by our board of directors. All real estate secured loans generally require fire, title and casualty insurance and, if warranted, flood insurance in amounts at least equal to the principal amount of the loan or the maximum amount available. Our loan approval policies and limits are also established by our board of directors. All loans originated by Huntingdon Valley Bank are subject to our underwriting guidelines. The following limitations apply to originations of loans. An underwriter may approve loans up to $417,000, and an executive vice president, assistant vice president or senior underwriter officer may approve loans up to $500,000. The Officer Loan Committee must approve “jumbo” loans (currently, loans between $500,000 to $650,000), construction loans and any conventional loans not receiving automated underwriting system recommendation. The Executive Management Committee must approve loans in excess of $650,000. The board of directors must approve loans in excess of $900,000 that are exceptions to the Bank’s lending policy. Delinquencies, Non-Performing Assets and Classified Assets Delinquency Procedures. When a loan is 15 days past due, we send the borrower a late notice. We generally also contact the borrower by phone if the delinquency is not corrected promptly after the notice has been sent. When the loan is 30 days past due, we mail the borrower a letter reminding the borrower of the delinquency, and attempt to contact the borrower personally to determine the reason for the delinquency in order to ensure that the borrower understands the terms of the loan and the importance of making payments on or before the due date. If necessary, subsequent delinquency notices are issued and the account will be monitored on a regular basis thereafter. By the 90th day of delinquency, we will send the borrower a final demand for payment and may recommend foreclosure. Loans are charged off when we believe that the recovery of principal is improbable. A summary report of all loans 30 days or more past due is provided to the board of directors each month.