Reg B

We had a woman come in and complete an application for a house loan. 3 days later she passed away. Would you consider this application withdrawn? If not, what you classify it as?

I would. You definitely don't want to be generating notices only for the grieving family to have to deal with.

Thank you!

rl- where this was an application for a house loan, this would also appear to be HMDA reportable. From that perspective, I believe this application could not be deemed 'withdrawn' as HMDA instructions state the applicant must expressly withdraw the loan before a credit decision is made.

You wouldn't want to code it as a file closed for incompleteness as this would require a written notice of incompleteness to the borrower under Reg B.

It would seem this request would need to be coded as denied by the institution with the reason of credit application incomplete.

Thoughts?

What ever you want, but at some point common courtesy must prevail. I would risk some stupid examiner trying to criticize me over sending a form that the family would have to deal with just to be sure I was covered from a regulatory standpoint.

I certainly would consider death an express withdrawal of the application. You have no applicant to notify of anything, she died.

Thanks for the input. New to the requirements of Reg B so just trying to make sure i have a solid understanding!

I have been advised now that it should be denied and the reason should be "deceased" and do not sent a letter to the family. Just document what happened and put it in the file.

Thanks for everyone's thoughts on this.

Thanks, Jenny!!

Advised by whom??

Our external auditors and from 2 training advisors

I'm not sure I would agree with it being a single applicant vs. joint applicants, but as long as you are consistent and document your file I would not protest too loudly.

I'm more in favor of treating it as a withdrawal. The applicant passed away therefore they cannot proceed with their request.

I have a file presented to me that LO sent out early disclosures for a purchase money mortgage. LO indicates that he has left 3 messages for the borrower to call and let him know if the borrower wants to proceed. The LO has indicated the file status as withdrawn Previously I would have defended the file's withdrawn status based upon the customers non verbal expression of withdrawn (by not returning the phone calls). With fresh eyes revisiting TRID comments regarding intent to proceed, "a customers silence cannot be considered acceptance". Am I over thinking this or should we be sending an NOI when it's pretty clear the borrower has moved on to another lender or chosen not to do the loan. What's my NOI say - intent to proceed is outstanding?

Send your NOI and move on. A withdraw of an application has to be "expressly" requested by the applicant.

Section 1002.9—Notifications

2. Expressly withdrawn applications. When an applicant expressly withdraws a credit application, the creditor is not required to comply with the notification requirements under §1002.9.

Silence is not expressly withdrawn.

Or decline for incompleteness. This is definitely not withdrawn.