How do I Write a Report Detailing the Reasons for Granting or Denying a Loan?

The Equal Credit Opportunity Act was passed to ensure that no lender turns down a credit or loan application due to an applicant's race, color, religion, national origin, sex, marital status or age. To help enforce the law, the U.S. government often looks at a lender's reports detailing reasons for credit approval and denial. If too many applicants are being rejected, the lender might need to revise its lending standards.

Instructions

1

List all of the categories that will appear on the report. These can include but are not limited to the applicant's name, age, race, ethnicity, gender, amount of money applied for, date of credit application and purpose of loan.

2

Write down the reasons for denial when an applicant does not qualify for a loan. When loan applicants are denied credit they are entitled to a letter explaining why. Reasons include but are not limited to insufficient credit history, insufficient income, history of late payments, too much revolving debt, lack of collateral or insufficient time at a job.

3

Prepare monthly statistics. All of the applicants that apply for credit in a given month should be listed on separate reports. At the end of the month, compile a statistical report on the number of applications that have been denied and approved, and for what reasons. This will help you spot trends on whether the percentage of denials goes up or down, or remains pretty constant. It will also let you know whether any particular demographic group is getting a higher-than-normal number of denials, and why.