I recently came across a some files in a review where the lending unit sent the applicant a Notice of Denial when the borrower had withdrew prior to the lending unit denying the loan. I am wondering if any of you think it would be appropriate to send the impacted consumers a notification letter explaining the error, explaining the loan was actually withdrawn, and explaining neither action impacts their credit score since those actions are not reported to credit bureaus? The thought process behind the letter is to alleviate any possible Fair Lending/UDAAP repercussions.

Have any of you sent such a letter? What are your thoughts?

IMHO, I would document the file, do some training, and, especially if the customer said nothing, I'd let a sleeping dog lie.

I would not send such a letter. I would also be super confused if I recieved that letter as a consumer. Just train and possibly look for a control to put in place to make sure it doesn't happen again.

Just curious, what did the denial letter tell the applicant if no credit decision had been rendered?

I agree that I would not send anything. There's really not anything you can do to fix this but you could make the applicant even more irritated.

RLCarey, it told the applicant did tell the applicant a credit decision had been rendered and gave specific reasons (unmet conditions - Unable to verify assets, income).

It doesn't sound like you gave any reasons to the applicant that would be particularly harmful if not corrected so I would go with everyone else here that you don't send another letter.

I'm in the same camp and for the same reasons, plus, there is no need to create work, there is more to do and there is little value in contacting an applicant now unless you wanted to say, the form was in error and you'd invite them to apply when they next have a borrowing need. BUT -- if the bank was leaning toward denial that may not be a true statement in which case I'd say "get back to work on a priority ask and don't worry about this."