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#290356 - 12/17/04 04:31 PM Unsure - Credit score disclosure
Anonymous
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Does the credit score disclosure need to be provided to each applicant/guarantor separately?

For example: Husband and wife apply for joint credit loan and wife's mom and dad are going to guarantee the debt. Credit reports with scores are pulled on all four people. The key factors are different for each person. Do we do one disclosure with all four people's information or four separate forms?

I think section (E)(iv) of the reg limits the disclosure to not more than 1 disclosure per loan transaction, but does that mean 1 disclosure with 4 people's information or just do it on and for the primary applicant?

We use laser pro and I have a processor telling me the system will not let her input more information than on the borrower/coborrower.

Thanks for the help and Merry Christmas!!! We're having our potluck today if anyone wants to join us here in north Louisiana we have more than we NEED to eat.

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#290357 - 12/17/04 06:09 PM Re: Unsure - Credit score disclosure
Nanwa Offline
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Nanwa
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Clintonville, WI, USA
OOOOO, got cornbread? I loves cornbread! Send me some, virtually of course!
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#290358 - 12/17/04 06:23 PM Re: Unsure - Credit score disclosure
Anonymous
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I think you need to do each on a seperate form. If the parties are married and live at the same address I would mail in the same envelope.

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#290359 - 12/17/04 06:24 PM Re: Unsure - Credit score disclosure
Truffle Royale Offline

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You have to disclose the information for all the applicants.

Your processor will have to figure out how to make the system work. (s)he may just be looking at a model form that needs to be tweaked to make it work. Either that or your form is for an individual and you'll have to fill out one for each applicant seperately. Everybody's doing it a little bit differently until somebody gets examined and we hear about the guidance (fallout?)they receive on this.

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#290360 - 12/17/04 07:07 PM Re: Unsure - Credit score disclosure
Anonymous
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Nanwa,

Believe it or not we have no cornbread, but we do have Hawaiian bread. So far the jambalaya is the best.

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#290361 - 12/17/04 07:39 PM Re: Unsure - Credit score disclosure
corkygirl Offline
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middle of the country
If you are talking about the credit score notice sent out after you have run credit, you need to send everyone their own notice, individually and in seperate envelopes. We use Laser Pro for documents but not using them for the notices. I have added the notice as a word document and that is what we are sending out, with the appropriate information for each individual.
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#290362 - 12/17/04 08:21 PM Re: Unsure - Credit score disclosure
Anonymous
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I guess the question is who are applicants? Obviously, borrowers and coborrowers are, but why would guarantors or cosigners be included in the definition of applicant? They are not applying for a loan, get no proceeds from the loan, nor do they get any other benefit. The folks at laser pro see it as only required to go to borrower/coborrower and not guarantor or cosigner. I am just not convinced they are right because it would seem logical to give notice each time a credit score was pulled to the person whose credit score was in fact pulled. On the other hand laser pro does not allow the disclosure to be pulled and my loan staff are not wanting to do more than they are required.

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#290363 - 12/17/04 08:56 PM Re: Unsure - Credit score disclosure
Nanwa Offline
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Nanwa
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Clintonville, WI, USA
Oh, I haven't made jambalaya in quite awhile. If we have some leftover shrimp after Christmas, I think I will make some!
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#290364 - 12/20/04 04:43 PM Re: Unsure - Credit score disclosure
Truffle Royale Offline

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Quote:

If you are talking about the credit score notice sent out after you have run credit, you need to send everyone their own notice, individually and in seperate envelopes.




Haven't seen anything that says this must be done individually and in seperate envelopes. Can you share why you're emphatic that it must be this way?

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#290365 - 12/20/04 04:51 PM Re: Unsure - Credit score disclosure
SamIAM Offline
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We receive a merged report on husband/wife from the credit bureau. The credit bureau has provided the disclosure; however, it reflects scores / factors for each individual on one sheet. Can we provide this notice to both or will we have to separate the information somehow and provide each person's score / factors individually?

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#290366 - 12/20/04 07:16 PM Re: Unsure - Credit score disclosure
Truffle Royale Offline

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I've seen nothing that prohibits sending the disclose as it is received from the credit bureau. IMO, the cba would not give it to you on one page if you couldn't use it that way. They're trying to sell a service. It wouldn't sell if we couldn't use it.

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#290367 - 12/20/04 07:22 PM Re: Unsure - Credit score disclosure
SamIAM Offline
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Posts: 212
Thanks for responding. I was concerned that there would be a privacy issue involved by sending out the combined notice.

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#290368 - 12/20/04 08:39 PM Re: Unsure - Credit score disclosure
Anonymous
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Are you using information from the Credit Reporting agency on the co-signer or guarantors? If you use the information you will need to send the disclosure. Remember that we are protecting the consumer not the bank.

Remember section 217
The co-signers or guarantors will need a notice if you will be reporting information about them when reporting to the credit reporting agency.

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#290369 - 12/20/04 09:53 PM Re: Unsure - Credit score disclosure
corkygirl Offline
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middle of the country
We are sending the notice of credit score seperately, to me it is a privacy issue. If my husband and I apply for a loan together, I am entitled to only my credit score, not his. Maybe I'm just being very conservative but I am sure that I heard that at a seminar on the FACT Act.
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#290370 - 12/20/04 10:05 PM Re: Unsure - Credit score disclosure
Anonymous
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The Q&A from MaryBeth's teleconference says that only one disclosure need be given, and that the question will become, to whom do you provide the disclosure? We are strictly providing it to the primary applicant.

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#290371 - 12/20/04 10:12 PM Re: Unsure - Credit score disclosure
Dan Persfull Offline
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Dan Persfull
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Bloomington, IN
According to Reg. B, when persons apply for joint credit, there is no privacy issues for sharing the content of the credit report.
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#290372 - 12/20/04 10:40 PM Re: Unsure - Credit score disclosure
Anonymous
Unregistered

It may not be required but we are sending separate notices anyway. We interviewed a few of our loan officers to find out how often someone opens credit without wanting another to find out - we were surprised that it happens often. From the Reg. B perspective, the unknowing co-applicant would typically only know about credit issues if credit was denied. However, with this new notice, regardless of the action, you could be telling an unknowing co-applicant (most often spouse) that the other's credit score was affected by things like the many recent inquiries or outstanding finance company loans. We did not want to be a part of the "what are you applying for" or "what do you have at a finance company" conversation.

In many cases, when an account is opened without another knowing, statements get sent to a different address and there are never any late payments. With this disclosure, it is a little more difficult to cover things up.

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#290373 - 12/21/04 02:57 PM Re: Unsure - Credit score disclosure
Anonymous
Unregistered

How do you have an "unknowing co-applicant?" Don't your applications have the "We intend to apply for joint credit." statement? If the applicant supplies "unknowing co-applicant" information to obtain credit, like the man said, per Reg B, any privacy issue is moot. And, doesn't the "unknowing co-applicant" have a right to know?

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#290374 - 12/21/04 03:03 PM Re: Unsure - Credit score disclosure
mmason Offline
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Joined: Nov 2001
Posts: 447
New England
Rant.
I think anyone applying for joint credit has a right to know about the other person's credit (spouse or not). If the other individual has bad credit because of past delinquencies, odds are that the one with good credit will end up either being responsible for the payments or damaging their own credit. Why shouldn't they know if that's an issue up front? If someone wants to keep their credit and/or a loan private, then get the loan in their own name.

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#290375 - 12/21/04 03:04 PM Re: Unsure - Credit score disclosure
rlcarey Offline
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rlcarey
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Posts: 78,597
Galveston, TX
OK anon - I almost answered the same way. However, in reading the post a little more carefully, I think they are talking about when the co-applicant may be "unknowing" about other attempts to gain credit or bad credit the applicant may have outstanding and that the co-applicant may be unaware of these other issues. While I don't think it is a privacy issue, they may feel it is a prudent practice (not that I agree).
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#290376 - 12/21/04 04:07 PM Re: Unsure - Credit score disclosure
Truffle Royale Offline

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From a business standpoint, per Reg B and IMO, it is in the bank's best interest for the co-applicants to know each other's credit standing. Because the bank expects to be paid back, each applicant should be able to rely on their own and their co-applicant's ability to make the payments.

The co-applicants have a right to know what's on the other's credit report too. If one doesn't know that the other has finance company loans or something else out there to pay, they may be relying on income that is already spoken for. And what if there are delinquencies out there? Does one borrower have the right to keep this information from the other so they can get ANOTHER loan?

I'm of the opinion that if you want to keep your business private, don't get a co-applicant. And don't expect your banker to shield information from a co-applicant for you.

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#290377 - 12/21/04 05:03 PM Re: Unsure - Credit score disclosure
Anonymous
Unregistered

MMason --- read the post again and, yep, "not knowing" about some of the applicant's "credit activities" sounds right to me, too. And I agree with bjp -- we're not here to shield anyone....we're not their "credit keeper". And, you can certainly "Cut and Paste" your Notice to both applicants, just as long as each gets the required info.

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#290378 - 12/21/04 06:35 PM Re: Unsure - Credit score disclosure
Anonymous
Unregistered

Original Anon here. Thanks for all the discussion/opinions. However, I am not reading much on my real question about what makes guarantors and/or cosignors applicants by definition? If the reg does not include them in the definition of applicant how can it require us to send them the credit score disclosure?

Thanks again for all the input! What about you Andy, where do you stand on this issue?

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#290379 - 12/21/04 07:47 PM Re: Unsure - Credit score disclosure
Truffle Royale Offline

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Posts: 17,324
Quote:

Are you using information from the Credit Reporting agency on the co-signer or guarantors? If you use the information you will need to send the disclosure. Remember that we are protecting the consumer not the bank.

Remember section 217
The co-signers or guarantors will need a notice if you will be reporting information about them when reporting to the credit reporting agency.




This appears to me to answer your question. If not, please clarify what else you're looking for.

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#290380 - 01/29/05 09:10 PM Re: Unsure - Credit score disclosure
Anonymous
Unregistered

Just following up on this thread and wondered if any one had gotten any other "official" comments on providing the notice to each person whose credit scores the bank obtained? We have the same issue and are a little concerned in that we use credit scoring and if we have a joint application or co-signer situation, we will pull the credit on all parties and then use the highest score (all other things considered) to approve the loan. It may be that it is the co-signer's score that we use. So we believe we should provide the notice to them. The language in the Act indicates if the bank "obtains" or generates a credit score, then the Bank shall provide each consumer whose credit score was "obtained"....the Notice. The last part of that sentence is what we believes directs us to provide the notice to all parties if we have their scores. Thank you.

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