Does anyone out there use Fair, Isaac for scoring consumer loans? If so, how are you handling the Adverse Action requirements that have come to light from the recent FTC opinion letter? The FI adverse action process appears to be an "all or nothing" situation; either all co-applicants recieve a letter with the FCRA disclosures even if their credit did not impact the decsion, or no one gets a letter, even if their credit did impact it. To do otherwise seems to involve a great deal of manual intervention, which we are trying to avoid by using this automated process. If we can't fix this, I would rather err om the side of providing a FCRA notice if it isn't needed than not providing one if it is. Any thoughts?

Whether or not the vendor can deliver a product, the bank is liable for the result. In this case, you need to comply with the FTC's interpretations. It is up to the vendor to enable you to do that -- or you should go find another vendor. Never let the vendor drive a compliance decision.

Lucy,
Do you see a problem with addressing the Adverse Action letter to ALL applicants(complete with the ECOA and FCRA disclosures) and then sending one copy of that all inclusive letter to each person? After all, if they jointly applied and would jointly receive the loan - then why shouldn't they jointly be declined?

Quite frankly, following the separate ECOA and FCRA disclosures - all to one and some to others is FRAUGHT with peril from human (and clerical) error.

You can send a combined letter IF the credit bureau statement is accurate as to each of the individual applicants. And herein lies the torture of the FTC's conclusion. Their reasoning is great in theory but the implementation of it is a nightmare.

This also trips over privacy concerns. For the moment, this appears to be dealt with by the agencies' view that applicants that co-apply do not have privacy issues between them. So you can let one applicant know that another had credit problems. But you are still left with the question of whether the statement is accurate as to each one of them. This is what we really need to get clarification on from the bank agencies. For the time being, I think your process is ok.