3 days after obtaining credit report.

Us too! As soon as we run DU and get the credit scores it will go out.

We actually ran this by our EIC, and according to the agency, the scores should go out as soon as we get them, but certainly no later than 3-5 days after application. That was my thought originally, but certain factions at my bank do not want to hear this and feel it is unreasonable because it will be a cost to the bank. I posted this poll to see how other banks are planning to comply and (hopefully) to get some backup for my position. I figured if everyone was giving the disclosures at closing I could go argue the point with my EIC, but that is not what I am seeing here. I think I was on the right track all along. Thanks to all who have participated - and keep posting!
BC

Is there any significant benefit to the consumer by receiving the credit score disclosure early in the application process? Since the law seems to allow some latitude, we'd like to provide it from our centralized processing function so we can maintain better controls. This means that it won't be provided with the GFE and early TIL which are provided at the time of application by loan originators using laptops. Is there any downside to providing the credit score disclosure later?

Maybe not a downside for the bank, but perhaps a downside for the consumer. I believe the thinking is that customers who receive their scores early on will have time to either (1) shop for a better rate or (2)improve their score by paying down some debt, closing lines of credit, etc. Whether this is true in actuality is arguable, but I think this is what Congress was thinking when enacting the portion of the Act. Providing the scores late in the process, even as late as closing, only provides the customer with yet another piece of paper to throw away or file in the ole shoebox, and does the customer absolutley no good at all. Your customers could sue you and argue that you circumvented the intent of the law by failing to provide them with menaingful information early enough in the loan process to make a difference. They might win.
BC

I think that's definitely true if the bank provides the disclosure at closing. But if we provide it during processing about one-third to one-half of the way from the date of application to closing, I think they still have enough time to take action on errors or derogatory items. What does everyone think of that approach? We're just a little concerned about leaving up to our loan originators out in the field.

I believe the regulators will eventually decide that 3 days is reasonable as it can then go out with other early disclosures (in a majority of cases.) Unless most of us show that we don't pull credit within the first three days. Not likely.

When did the cost to the institution become a major factor in regulatory interpretation of any Act or regulation with the word "Fair" in it?

Why is this such a hard requirement to adhere to? The law is very plain that the notices must be sent as soon as reasonably practicable.

Explain to me how, or better yet to your examiner, that if you pulled the credit report and credit scores on 12/3/04 and did not mail the notice to applicants until 12/10/04, that you provided the disclosures within a reasonable (fair) and practicable (feasible) time?

I cannot believe, and I do not think any examiner will either, that it takes someone 7 days to fill out and provide a form when the information you need to complete the forms is there immediately upon obtaining the credit report.

I will stick with the opinion that within 3 business days, or 3-5 calendar days, is a reasonable and practicable time to provide the disclosures. Just my two cents worth.

For those of you who intend to wait until closing to provide the notice, what about turndowns?

I agree with you 100%! We are sending it out with the intial docs and I think any later would be out of compliance. You might as well just add this to your initial doc package and be done with it.

The intent of the Act, IMHO, is to provide the applicant with the information we are basing our credit decision on as near to the same time we get it as possible.

The Act contains many provisions regarding Identity Theft. What if there's something on the credit bureau that causes you to give your borrower a different rate than if that item wasn't there and it turns out not to be your applicant's? You have chosen not to give them the disclosure till the closing. How much more costs have you run up by having them rescind when they look at the credit bureau after closing or, worse yet, decide to sue you?

I don't see how you can possibly consider waiting to give the notice and disclosure. As soon as you get it, the "resonable" clock starts ticking. I agree with the others who think that ultimately, examiners will expect this to go out with the GFE and TIL.

Well, my examiner is the Fed and they told me otherwise by e-mail and in no uncertain terms. I'm not intimidated - I just know they are going to be examining for that timeframe and I intend to comply. As someone said earlier - money is not the issue when dealing with consumer protection laws and regulations. How much does a stamp cost, for pity sake? If you have 100 applications a week for home equitys and you send the score and notice out separately each time - you are talikng about what---$37.00???? Puhleeze!! You go argue with your regulator about the "cost", and please post here and let all of us know how that comes out, would you?

The argument is not over the cost. It is about what the law states, which by the way is not written by the regulators but by congress. Let say you did not pull the credit report until the fourth day after you received the application, are you suppose to disclose a credit score that you do not have by the third day? Will the examiner then tell you that you must pull the report immediately upon receipt in order to comply with this 3 day from application requirement that does not exist anywhere?

I am not saying you shouldn't try to get the disclosure out within 3 days, in fact, I said it was a good idea. But there will be cases where you may not. When that happens I would not let any examiner cite me for violation of a made up regulation. But that is just me.

The Fed told us that they expected us to give the disclosure "as soon practicable after we have the credit report". That leads me to think that if you do not obtain the credit report until the 4th day or the 15th day that you would not need to give it to your customer until then. As someone stated above, most creditors obtain a credit report immediately, so within 3 days is reasonable. What would not be reasonable would be obtaining the report and not giving it to your customer as soon as you can. I agree with you that this law is poorly written. However, your regulator is the one who examines you and who will decide whether or not you are in compliance with the law - both as written and as interpreted by them. I am hoping that the Fed will see all the confusion this has caused and will ultimately decide to write either regulations or at least some kind of unofficial guidance.

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which by the way is not written by the regulators but by congress.

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Yes, but the regulators enforce it.

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Let say you did not pull the credit report until the fourth day after you received the application,

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Don't base your 3 business days from the date the application is received, but 3 business days from the date the credit report is received. If you can get a GFE & ETIL out within 3 business days from receipt of the application, why will it be so difficult to get the NHLA and the credit score disclosure out within 3 business days of receiving the credit report?

The intent of the Act is to get the information in the consumer's hands as soon as possible.

Saladin, the following is not directed at you, but to everyone in general - it's just your post I tagged to.

Are you afraid if you furnish this to your applicant before closing you're going to lose them - if so then you have pricing problems IMO.

How on earth can you justify not giving the disclosure within 3 to 5 business days (as soon as reasonably practicable) from receiving the credit report. For Pete's sake, the person pulling the credit report, or the loan officer is going to be looking at it almost immediately - what's the big deal taking 3 to 5 minutes to fill in the blanks and mail the dad burn form(s).

I just don't understand the resistance to this.