A college has served as a "silent" guarantor for their students on several previous loans. Due to the Q & A article, Debtor's Privacy & Guarantor Notification, we're considering providing a 2nd "special" privacy notice (basically an addendum) to these student applicants, stating we may disclose non-public personal information to the school as a non-affiliated 3rd party.

Is there any prohibition against an additional "special" privacy notice to ONLY be provided to a designated segment of borrowers?

Also, are there any fair lending issues if we're generally approving these loans based solely on the strength of the guarantor? In other words, without the guarantor we would most likely not consider approving the loan requests, as the vast majority of the students are not within our trade area.

Anyone?

So, one question. By "silent" you mean the student doesn't know the school is involved?

Correct.

Also, as a different option...

If we instituted a buy-back agreement with the school and only sold the loan in the event of a default, would that be a breach of privacy if the aforementioned alternate notice with opt out clauses weren't provided?

Or, would that situation be more likened to an investor simply purchasing a loan?