Thread Options
#2012997 - 05/08/15 04:46 PM Collection Triggers
Tesla Offline
Power Poster
Joined: Nov 2003
Posts: 3,669
Is anyone using a product from their credit reporting vendor that notifies you when a consumer defaults or has other negative activity in their credit history?

Do you have to give a credit score denial notice, even though you technically don't use the score but it is part of the report?

What have your examiners asked about this program? Can you give any advice?
_________________________
It's not that I take life for granted. It's only that the good won't make it. Innocence dies, while Villany Thrives.

Return to Top
#2013029 - 05/08/15 05:41 PM Re: Collection Triggers Tesla
NSF, CRCM Offline
Gold Star
NSF, CRCM
Joined: Apr 2013
Posts: 410
VA
We do not use this product.

Originally Posted By Tesla
Do you have to give a credit score denial notice, even though you technically don't use the score but it is part of the report?


FCRA requires the notice to be provided if you take any adverse action. If you are just getting the report and not taking any action then a notice is not required.
_________________________
It is better to act cautiously beforehand than to suffer afterward.

The answers I give are my opinions. Not legal advice.

Return to Top
#2013081 - 05/08/15 07:01 PM Re: Collection Triggers Tesla
Tesla Offline
Power Poster
Joined: Nov 2003
Posts: 3,669
Realized I need to add more detail... these are open end credits and we want to freeze or close their line of credit. The bureau looks at our specific portfolio (by subscriber code) and provides us score
_________________________
It's not that I take life for granted. It's only that the good won't make it. Innocence dies, while Villany Thrives.

Return to Top
#2013092 - 05/08/15 07:23 PM Re: Collection Triggers Tesla
NSF, CRCM Offline
Gold Star
NSF, CRCM
Joined: Apr 2013
Posts: 410
VA
Freezing or closing the line of credit would meet the definition of an adverse action.

I believe this would warrant an ECOA notice and FCRA notice to be sent to the customer.

Hopefully one of the Gurus will chime in to confirm or correct me.
_________________________
It is better to act cautiously beforehand than to suffer afterward.

The answers I give are my opinions. Not legal advice.

Return to Top
#2013106 - 05/08/15 07:58 PM Re: Collection Triggers Tesla
Tesla Offline
Power Poster
Joined: Nov 2003
Posts: 3,669
Thanks NSFW - didn't see your post before I put my reply up. Anyone using this product?
_________________________
It's not that I take life for granted. It's only that the good won't make it. Innocence dies, while Villany Thrives.

Return to Top
#2013109 - 05/08/15 08:01 PM Re: Collection Triggers Tesla
Tesla Offline
Power Poster
Joined: Nov 2003
Posts: 3,669
Yep, I agree ECOA/FCRA AAN with credit score information. Now, I just wonder what regulators think of the program. I'm thinking we could have a customer paying us perfectly but defaulting on his mortgage or other debt with someone else and we would be closing his LOC. Thoughts?
_________________________
It's not that I take life for granted. It's only that the good won't make it. Innocence dies, while Villany Thrives.

Return to Top
#2013142 - 05/08/15 09:27 PM Re: Collection Triggers Tesla
Dan Persfull Offline
10K Club
Dan Persfull
Joined: Aug 2002
Posts: 46,710
Bloomington, IN
You can't just suspend someone's HELOC because they are past due on other debts. You have to have sufficient documentation to support you have a reasonable belief that you won't be repaid, your equity position has significantly declined etc.

You may want to look up and review the FDIC's Financial Institution Letter FIL-58-2008, June 26, 2008.
_________________________
The opinions expressed are mine and they are not to be taken as legal advice.

Return to Top
#2013153 - 05/08/15 10:12 PM Re: Collection Triggers Tesla
Tesla Offline
Power Poster
Joined: Nov 2003
Posts: 3,669
These are credit cards - sorry for forgetting that detail.
_________________________
It's not that I take life for granted. It's only that the good won't make it. Innocence dies, while Villany Thrives.

Return to Top
#2013237 - 05/11/15 03:09 PM Re: Collection Triggers Tesla
Tesla Offline
Power Poster
Joined: Nov 2003
Posts: 3,669
So I think this is OK for credit cards. I read the rule and the only specific exemptions I see are, as Dan pointed out, under the dwelling secured section.

Am I missing anything? Is anyone else using this service from their CRA vendor?
_________________________
It's not that I take life for granted. It's only that the good won't make it. Innocence dies, while Villany Thrives.

Return to Top