A: No, although this is a common practice. Under Regulation B, banks may send only a notice of incompleteness within 30 days after receiving an incomplete consumer application. See 12 CFR 1002.9(c)(1)(ii). The notice of incompleteness must be written, specify the needed information, designate a reasonable time for the applicant to respond, and inform the applicant that no further consideration will be given to the application if the needed information is not provided. If the needed information is received after the time designated in the notice of incompleteness, then banks may require the applicant to restart the application process. Banks may also provide an adverse action notice within 30 days after receiving an incomplete consumer application, but should only do so if they are denying the application. Banks will need to follow the usual adverse action notice requirements. The adverse action notice must include:
1. A statement of action taken;
2. The bank’s name and address;
3. The ECOA notice;
4. The name and address of bank’s prudential Federal regulator; and either;
5. A statement of specific reasons for action taken; or
6. A disclosure of applicant's right to a statement of specific reasons within 30 days, if requested within 60 days of bank's adverse action notice.
Banks may always verbally request additional information, but this action will not avoid the need for banks to provide an adverse action notice or notice of incompleteness.