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How do Regulation B signature limitations apply to situations where the application begins with a sole applicant but later and prior to approval, the applicant asks the bank to add another individual to the application?

My question involves the definition of joint application. Regulation B (Equal Credit Opportunity Act) limits when a creditor may require the signature of an applicant’s spouse or other person if the applicant qualifies individually. The signature limitations do not apply to joint applications. The Regulation B Commentary states, “…the term ‘joint applicant’ refers to “someone who applies contemporaneously with the applicant for shared or joint credit,” and “a person’s intent to be a joint applicant must be evidenced at the time of application.” (§1002.7(d)(1)-2 and 3). How does this apply to situations where the application begins with a sole applicant but later and prior to approval, the applicant asks the bank to add another individual to the application?

An individual application becomes a joint application at the point the applicant asks the bank to add another applicant to his or her loan application, even if the bank has received and begun processing the application. Therefore, the bank would need evidence of joint intent to apply at the time that the additional party gives the creditor his or her application. The Commentary states the evidence of joint applicants is required "at the time of application." It does not specify "initial" or "complete" application.

Evidence of joint intent is only required if the person is added at his or her own request or at the request of the other applicant. If the person is added because the bank requires an additional party as a condition of granting credit, then evidence of joint intent is not required. (March 2019)

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