Credit Score Disclosure

Posted By: JW QC Audit

Credit Score Disclosure - 04/16/10 08:18 PM

FCRA (Consumer Credit Score Disclosure when credit report is pulled)

The company has a pre-qualification process, we obtain a credit report for this process. must be delivered to the customer, the credit score disclosure?
Posted By: Princess Romeo

Re: Credit Score Disclosure - 04/17/10 04:31 AM

Here is what FCRA states regarding mortgage lenders providing credit scores:

g) Disclosure of Credit Scores by Certain Mortgage Lenders
(1) In general. Any person who makes or arranges loans and who uses a consumer credit score, as defined in subsection (f), in connection with an application initiated or sought by a consumer for a closed end loan or the establishment of an open end loan for a consumer purpose that is secured by 1 to 4 units of residential real property (hereafter in this subsection referred to as the "lender") shall provide the following to the consumer as soon as reasonably practicable:

You could argue that a pre-qualification is not secured by anything, so you wouldn't need to provide the disclosure until the customer identifies a property and moves forward with an application for a loan to be secured by that property.
Posted By: JW QC Audit

Re: Credit Score Disclosure - 04/28/10 06:37 PM

Posted By: Dan Persfull

Re: Credit Score Disclosure - 04/30/10 03:16 PM

I will have to take a different opinion.

A prequalification will be secured by a 1-4 residential real property. The FCRA does not have the designation that a property has to be identified.

No credit request is "secured" by the collateral until the request is consummated. So you could try to make the argument the disclosure is not required for any credit request until it is consummated, and we all know that argument isn't going to fly.

IMO, if the credit score was used in your credit decision then you must provide the disclosure. If you declined the prequalification request it is most definitely required.