If the borrower truly initiated contact to the bank and withdrew, I would call it a withdrawn loan for Reg B purposes. However, I have seen instances where a loan officer "steered" a customer to withdraw due to this type of information. If that was the case, it would be a denial. Just make sure you document your file clearly as to what actually happened.
Adam Witmer, CRCM
All statements are my opinion, not those of my employer, and should not be taken as legal advice.www.compliancecohort.com