If we report DTI as the denial reason (#1), would/should we report Credit History (#3)?

We are having a conversation around the DTI Denial reason; as the credit history, and obligations are a key component of developing a DTI, would you also report Credit History when you deny someone for Income insufficient for amount of credit requested, or Excessive obligations in relation to income?

I searched other threads and couldn't see this particular question asked.

What is the relationship between DTI and Credit History. I fail to see it. One is a mathematical formula. The other is based on facts reported.

I think you might be confusing the need to reference the credit report in an adverse action notice if you used the credit report to verify or calculate current required debt payments that go into the DTI calculation.

I tend to agree with you Randy, DTI is the reason we have denied, not their credit history.

Their credit report is certainly a factor in developing the DTI, in terms of the payments/obligations, but we aren't denying them for delinquencies, or a negative payment history, which would necessitate denying for credit history.

And yes, I think there may be some confusion around FCRA requirements for the AAN.

Oh - and when I said "I think you" - that was meant as a general term and I was not specifically talking about "you". smile I should have phrased that better, like "There may be some confusion......."

No worries, I am always grateful for your insight.

DTI denials often are reported on the AAN as "insufficient income for loan amount requested" or "insufficient income for debt obligations."