We have an online application system for our consumer loans, including home equity loans and lines. When the customer completes the application, they must agree to T & C, plus will receive early HELOC disclosures before the application is submitted to the bank. For our non-RE secured loans, we are saying that the online application is enough and we do not need a separate application form signed.

However, our Compliance team has stated that even when we receive online applications for RE-secured loans, we should generate a traditional application form to gather applicant's signature - either wet ink or through remote eSign.
Is this necessary? What do we gain? What is at risk if we do not complete a traditional application form with customer signature?

thanks,

Ask your Compliance Team for the legal opinion they are basing their recommendations on. Do you not get a signed completed credit application prior to closing?

Without knowing why they want it, it's hard to say. By traditional application form are you referring to a URLA? Do you sell HELOCs?

If it's just Reg B written application requirements, point them to the commentary.

3. Computerized entry. Information entered directly into and retained by a computerized system qualifies as a written application under this paragraph. (See the commentary to § 1002.13(b), Applications through electronic media and Applications through video.)