One question we get frequently is, do the joint intent boxes have to be marked? When it comes to evidencing applicants’ intent to apply for joint credit, the boxes are one way of demonstrating that but it’s not the only way. What would you do if you received a phone, internet or mail application and they didn’t mark those boxes? The answer is, the loan officer needs to document, “this is what they said” or “this is what they wanted”. The boxes obviously are a great way to do that, and I would get them marked if you ever see them. If it’s a phone interview; however, you might just write down that Dave called and said he and his wife wished to get a car loan. Such a notation is evidence of joint intent.
The catch to this is that joint intent has to be done at the time of application. So, if they’re not in front of you at the time of application, the only answer is, is that the loan officer does it. That’s the regulatory side of it but there is also a civil liability side to consider. I have been an expert witness in a couple court cases involving joint intent where the banks did not have evidence. In both cases, the judge ruled that the loan was null and void and therefore the bank didn’t have consideration and they look to the collateral. It’s a mess. So, I always recommend that whenever you see the applicants you might want to get the joint intent documentation signed, not to appease the regulation, but rather to have a belt and suspender method, for the civil liability side of it.
This is the kind of thing we’re going to talk about in our upcoming “Regulation B Joint Intent” webinar on February 12th. This one-hour webinar will get into all kinds of scenarios with guarantors, cosigners, comakers, co-borrowers, etc. We’ll cover how to get this documentation, when you need the documentation, and we’ll also look at both the Regulation B and the civil side of joint intent.
David’s banking career began as a field examiner for the FDIC in 1990. He later became a Compliance Officer and Loan Officer for a small bank. In 1993, he established Banker’s Compliance Consulting. Along with his amazingly talented Team, he has written numerous compliance articles for prestigious banking publications and has developed compliance seminars that Banker’s Compliance Consulting produces.
He is an expert in compliance regulations. He is also a motivational speaker and innovative educator. His quick wit and sense of humor transforms the usually tiring topic of compliance into an enjoyable educational experience. David is on the faculty of the American Bankers Association National Compliance Schools and has served on the faculty of the Center for Financial Training for many years. He also is a frequent speaker at the ABA’s Regulatory Compliance Conference. He is also a trainer for hundreds of webinars, is a Certified Regulatory Compliance Manager (CRCM) and has been a BankersOnline Guru for many years. The American Bankers Association honored David with their Distinguished Service Award in 2016.
David and his wife Karen have three adult children, four grandchildren (none of whom live at home!) and two cats (of which Dave is allergic … the cats, not the children!). They recently moved to an acreage outside of Lincoln, Nebraska where he gets to play with his tractor. When possible David can be found fishing, making sawdust in his shop, or playing the guitar and piano. He also enjoys leading worship at his church.