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#2231055 - 02/14/20 03:50 PM Adverse Action Notice HELOC Reinstatement
Annie Offline
Junior Member
Joined: Sep 2018
Posts: 27
Assume a borrower's HELOC has been suspended due to a valid reason under Reg. Z. Later, the borrower provides a written request (per instruction) for reinstatement. If the lender reviews the request and determines that it will not reinstate, is an AAN notice required? If the reason for non-reinstatement is based in whole or in part on information from a CRA, would FCRA adverse action apply? I understand that an AAN would be required at the time of suspension, but what about reinstatement. Is this considered a request for credit?

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Lending Compliance
#2231245 - 02/19/20 11:09 AM Re: Adverse Action Notice HELOC Reinstatement Annie
rlcarey Offline
10K Club
Joined: Jul 2001
Posts: 77,310
Galveston, TX
This is not directly addressed anywhere that I could find. I think that it would not require an additional AAN, as the adverse action was already taken when you froze the line. But since it is a gray area, there would be absolutely no harm in providing one, as you should be communicating to the customer the reason that your customer failed to meet the reinstatement criteria anyway.
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