Our commercial loan system includes loans granted for consumer purposes because our consumer system can't handle payment streams other than regular installments. Do we create any significant risks if we don't report any loans to the credit bureau from our commercial system?

I've read some other threads which stated that while banks aren't required by regulation to report to credit bureaus we should handle all loans the same way within each portfolio so all borrowers are treated fairly. In our case we won't be treating all consumer loans the same, but we will be treating all consumer loans within a certain portfolio the same.

Thanks.

Terry, I believe that you are right.

However, one of the predatory issues that continuously surfaces is when debts and payment histories are not reported to the credit bureaus, the lenders are denying the borrowers valuable history and information in (re)building or maintaining their credit. Many predatory lenders purposely did not report credit so they had a captive audience in refinances. The OCC in one of their early 2001 advisories referred to one of the causes of subprime being customers with incomplete credit histories.

You might want to ensure that the borrowers getting the different payment terms are not getting them for inappropriate reasons.