The Consumer Financial Protection Bureau clarified that Paycheck Protection Program loan applications are only a “completed application” under the Equal Credit Opportunity Act and Regulation B once the creditor has received a loan number from the Small Business Administration or a response about the availability of funds.
In new frequently asked questions, the CFPB said this clarification will ensure the time awaiting this information from the SBA does not count toward the 30-day time period under Reg B in which creditors are required to notify applicants of the creditor’s approval, counteroffer, denial or other adverse notice regarding the application.
The FAQs clarify that:
- If the creditor denies an application without ever sending the application to the SBA, the creditor must give notice of this adverse action within 30 days.
- A creditor cannot deny a loan application based on incompleteness where the creditor has enough information for a credit decision but has yet to receive a loan number or response about the availability of funds from the SBA.