Borrowers have filed bankruptcy, but have reaffirmed on their HELOC debt.
Monthly P & I payments will be made on the HELOC per bankruptcy court.
The credit line will be suspended, and draws will no longer be available.
Is an adverse action notice required since the line will be suspended?

I would say that this likely falls into a combination of these two:

(2) The term does not include:

(i) A change in the terms of an account expressly agreed to by an applicant;

(ii) Any action or forbearance relating to an account taken in connection with inactivity, default, or delinquency as to that account;

I would be more afraid that such an action constitutes converting this HELOC into closed-end credit.

iii. If the consumer and creditor enter into an agreement during the draw period to repay all or part of the principal balance and the amount of available credit will not be replenished as the principal balance is repaid, the creditor must give closed-end credit disclosures pursuant to subpart C for that new agreement. In such cases, subpart B, including the substantive rules, does not apply to the closed-end credit transaction, although it will continue to apply to any remaining open-end credit available under the plan.

If the court included the suspension of the credit line in its order approving the reaffirmation of the HELOC debt, the borrower agreed to the suspension. I believe that fits the exception in Reg B's § 1002.2(c)(2)(i) from the definition of "adverse action," and no notice would be required.

Thank you both for your comments. I will need to do more research as to how the court proceedings played out.
Thanks!

To address Randy's concerns about the account possibly being converted to closed-end credit.:

Official Interpretation
2(a)(14) Credit
1. Exclusions. The following situations are not considered credit for purposes of the regulation:

ii. Tax liens, tax assessments, court judgments, and court approvals of reaffirmation of debts in bankruptcy. However, third-party financing of such obligations (for example, a bank loan obtained to pay off a tax lien) is credit for purposes of the regulation.

Dan - nice catch.

Great!
Thank you Dan!