Greetings all,

I was instructed by upper management that declines due to covid19 are not acceptable because it is currently affecting everyone. Secondly, denying due to "unfavorable economic/industry conditions" is also unacceptable due to it's broadness and lack of specificity. (§1002.9(a)).

Declines should be due to specific reasons like "unable to verify income" (one example) or due to moratorium, if that's the case.

Thoughts?

When you say "due to Covid19" what exactly does that mean? Is that a decline because the lobby of the bank is closed? Or is it a decline because the person lost their income because their employer closed up shop? Is it a decline because the PPP ran out of money? Just trying to understand to provide a meaningful answer.

Hey Rock,

Your point has been made with your response. We have been receiving adverse action notices from business units with "decline due to covid19" as the ONLY reason. Super broad as pointed out by the reasons you have provided, and I suppose this is why we received that as instruction. Luckily (or not), our p&p requires the business units to have Compliance approve adverse action notices before going to the applicant.

Thanks.

Now that I understand your first post I agree that "decline due to covid19" is not a specific reason. I'm not sure what "due to moratorium" means. Reg B requires specific reasons.

Florist, what the others are saying.
The AAN reason for decline is to help the applicant correct the situation they are being declined for so they can get the loan.