If you have a husband and wife applying for a loan that is for a consumer purpose and is secured by a 1-4 residential property, can we give one credit score disclosure that includes both the husband and wife credit score information, or do you give one disclosure to each applicant?
Posted By: Anonymous
Re: Credit Score Disclosure - 02/23/06 08:56 PM
According to Jack Holzknecht in his "How to Audit for Compliance with the FACT Act" seminar, "The FCRA requires a financial institution to disclose all of the credit scores that were used in these transactions. For example, if two joint applicants apply for a mortgage loan to purchase a single-family-residence and the lender uses both credit scores, then both need to be disclosed. The statue specifically does not require more than one disclosure per loan; therefore, if multiple scores are used, all of them can be inclusded in one disclosure containing the Notice to the Home Loan Applicant.
I hope this helps.
Posted By: sue's mom
Re: Credit Score Disclosure - 02/23/06 08:56 PM
We prepare a disclosure for each applicant. They all go in the same packet to the customer.
We also give a separate disclosure to each applicant.
Posted By: Truffle Royale
Re: Credit Score Disclosure - 02/24/06 03:26 AM
This has been discussed a couple of times before. A search would give you the chance to read a bunch of others' input on this subject.
fwiw, we print the disclosure that is generated by our tri-merge cbr and send that to our borrowers.
Posted By: Jan94
Re: Credit Score Disclosure - 07/11/06 03:35 AM
I was going back through our procedures and thought our banks did this the same way, but found that they do not. The banks are credit scoring and for joint applicants, they use the best credit score in the decisioning process. That is the applicant who gets the notice. In the example above it states that "the lender uses both credit scores" and in our situation they do not, they just use the best score. I'm a little concerned as it would appear that the banks are still using both scores to make a determination of which is the "best" and a notice probably needs to be provided to both applicants. Would appreciate some other thoughts? Haven't had a regulator state that we were doing this wrong (yet)
. Thanks.
Posted By: Dan Persfull
Re: Credit Score Disclosure - 07/11/06 12:44 PM
If you pull 3 credit scores and your policy is to use the middle score. How do you determine what is the middle score if you do not use all three scores?
I agree with you, the scores are being used and should be disclosed.
Posted By: JohnDoe
Re: Credit Score Disclosure - 07/11/06 08:09 PM
Another point in agreement with Dan is permissable use.
If you didnt use the score why did you pull it?
Hope that helps as well.