If you are a HMDA bank, you know that your HMDA data must be accurate as there is very little room for error. One of the pieces of data you are required to report is the action you take on a HMDA application. Your options include:
- Loan originated
- Application approved but not accepted
- Application denied
- Application withdrawn by applicant
- File closed for incompleteness
- Purchased loan
- Preapproval request denied
- Preapproval request approved but not accepted
While this may seem pretty straightforward, the action taken data field is one that often leads to errors. So, let’s take a close look at Code 4 “Application withdrawn by applicant”.
David explains more in the video.
Transcript:
So let's go to this withdrawal here. First off,
I want you to understand that it's express. They're telling you to forget about it.
It's not that we just haven't heard from them for a while. We've sent them three emails, written them a letter, and left five phone messages on their phone. No, we didn't hear from them. That's not a withdrawal. So the absence of information from them does not create a withdrawal. In fact, we're going to talk about what you'll need to do. So you have to have something affirmatively negative if you will. I wish to not proceed. I wish to would draw. We decided to go somewhere else. Something like that. It's a comment from them in writing or in person, verbal, that tells you we're out of here.
Now, go down to the next part, prior to. Prior to you communicating in denial. Prior to a credit decision. If you've already made a decision, no, then you've got a denial. They can't withdraw. That is what's represented on the previous page as well as here. If you're saying yes, and they're fully vetted, and now they withdraw, then that would be approved, not accepted. That wouldn't be a withdrawal. Prior to the notice of incomplete, because once you... Well, the expiration of the incomplete. We're going to get to that next page. Because once you have that and you're going to code it as incomplete, prior to satisfying all underwriting credit conditions in number four, that's approved, not accepted as I just mentioned.
Published
2022/04/11
