If my company cannot approve a loan request on our retail end, we deny the loan and follow standard denial procedures. However, I have found out that in some instances the same retail branch will then broker out the loan request to another company. So far, in my research, it appears that the retail loan is denied; then, when the brokered loan funds, a new loan number is assigned. I do not feel that this is acceptable practice. Wouldn't this mess up HMDA reporting?

Refer to Getting it Right. If you deny a loan request, then broker it out, you still report the denial.

Is okay to have two loan numbers for the same transaction?

Please expand on your question. I'm not sure what you are asking, but normally the same transaction would not have 2 separate numbers.

Where the loan is denied as a retail loan. Then, when brokered out and funded, a new loan number is assigned.

I don't deal with brokered loans so I'm speaking off the top of my head. As Paul said earlier, if you deny the loan you have to report it as a denial. If the loan is later brokered the person making the loan decision would report it. You have to have an unique loan identifier for the LAR. So, in this case I think 2 numbers would be acceptable for tracking purposes.

Would it also be acceptable to keep the same loan number and manually change the decision to denied when we HMDA scrub the file? We would document all activity in the file.