We enter our loan applications directly into an LOS when someone comes into a branch to apply for a loan. The applicant does not receive a paper application to fill out. Do we only request and complete the aggregate data? If so, am I correct in stating that the only time we would ever have subcategories is from a written application/demographic information form completed by the applicant whether it be online or otherwise?

I am not sure there is any option in the regulation to request this information orally when you have an in-person application. Plus - even if allowed, training everyone properly and reading them the whole form with all the available selections is going to waste a lot of time.

Thank you. Just needed to be sure.

You may want to review Appendix B.

https://www.bankersonline.com/regulations/12-1003-appb

I have reviewed Appendix B and am trying to model our procedures after this. Where does it state we are not required to ask for the subcategories for an application taken in person or by telephone?

For telephone applications it says we "must state the information in the collection form orally, except for that information which pertains uniquely to applications taken in writing, for example the italicized language in the sample data collection form". The italicization is limited to "check one or more" and some descriptions of Other. Is there further description elsewhere that clarifies "information which pertains uniquely to applications taken in writing"?

For in person, Appendix B clarifies we report aggregate data if the applicant doesn't provide the information and we have to use visual or surname, which makes total sense. Where does it say we don't have to ask for what is on the form?

You should definitely review Appendix B.

You have to request the data, and you have to report what they say (not just aggregate). If they don't want to provide the information in person, then you have to base it on visual observation/surname and only use aggregate categories.
No. If you ask for ethnicity and they say Brazilian, then you need to report Brazilian. I'd argue you should(arguably must) walk them through the form orally if you aren't providing it whether in person or on the telephone. I would definitely just give them the form.

Inherent Risk - I agree with you as you can see from my response (portion below):


I was a bit thrown by rlcarey's response:


I also interpret Appendix B to include requesting the subcategories for a telephone application. Is that correct?

I made the statement that I did because the regulation requires that: " For applications taken by telephone, the information in the collection form must be stated orally by the lender". There is no other support in the regulation or any other guidance for asking for this information orally for an in-person application.