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When consumers contact the bank to find out how much they could borrow, they have an informal conversation with a lender, giving general information about their income and debts. The lenders do not obtain credit reports, Social Security numbers, or property addresses. For conversations that do not turn into applications, how long should we retain records of the conversation and the information?

My bank does not have an official pre-qualification program in place. Instead, consumers will usually contact a lender on a random basis to find out how much they could borrow if they decide to begin searching for a house. The lenders do not obtain credit reports, Social Security numbers, or property addresses. The borrowers give general information about their income and debts. The lenders neither approve nor deny. They only state the amount that, based on the information given, the customers might be granted. Some of these inquiries turn into a full application, whereas others are not continued. For those that are not continued, how long should we retain records of the conversation and the information?

A “discussion” is not an application for credit unless the lender declines the request. So, if someone calls, as you describe, and nothing more happens, there are no record retention requirements. However, if, during the discussion, the borrower provides information such as “I have a credit score of 450” or “I declared bankruptcy last year” and the lender tells the individual that the bank does not loan under those circumstances, that is adverse action and a notice must be provided and a record retained for the requisite time Regulation B requires. (May 2017)

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