We have a revolving line product that has a one year maturity, so either it’s paid off at maturity or can be can be renewed based on evaluating updated info. Sometimes LO's send out a letter asking for updated financials/info (from loan pending maturity reports) or in other cases, the customer contacts us directly about renewing the loan.

When financials/info are recv’d, request is processed, if denied, adverse action notice sent. Compliance has always viewed the date financials/info received as date "app complete" for purposes of REG B adverse action timing. The opposing argument is that since this is a request for renewal, the date "app completed” and the timing requirement does not apply.

My opinion is this is a new request denied, not a term of existing loan, because there was a maturity date the customer agreed to. Re-reading REG B has not given me an answer, as there is no mention of renewals, so am assuming renewals are really new requests, which leads back to the app complete date. Can anyone tell me how you view/handle these, and your basis? Any help is appreciated. My brain is about fried!!

OK. The line matures on 12/31 and, as an example, a request for renewal is made by the customer on 10/31. The loan officer has 30 days to make the decision on whether to renew the loan (11/30). That is the way that I would view it. The loan officer does not have the latitude to wait until 12/31 to make the decision as credit has been applied for on 10/31.

Thanks. I agree with you. The app completed date would be when we have secured the necessary info to make a credit decision. For some reason, the LO's have been operating on the premise that being a renewal exempts this from REG B criteria.

From 202.2:

(j) Credit means the right granted by a creditor to an applicant to defer payment of a debt, incur debt and defer its payment, or purchase property or services and defer payment therefor.

The debt is coming due, the borrower is requesting (applying) that you continue to grant them the right to defer the payment of the debt. This is a request (application) for credit and the provisions of Reg B apply.

Thanks Dan and Randy--as always it is much appreciated.