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If we request an applicant’s credit score for a consumer loan, and the score is “N/A”, how do we handle listing the four key factors in the adverse action disclosure? – IBA Compliance Connection

If we request an applicant’s credit score for a consumer loan, and the score is “N/A”, how do we handle listing the four key factors in the adverse action disclosure?

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You are not required to disclose the applicant’s credit score because the applicant does not have a credit score (unless your institution used information from the report to create its own credit score for the applicant).

Dodd-Frank amended the Fair Credit Reporting Act (FCRA) to require creditors to include additional information in adverse action disclosures where the adverse action was “based in whole or in part on any information contained in a consumer report.” 15 USC 1681m(a). If you used information contained in the consumer report (even if the only information you used was the statement that the applicant does not have a credit score), the FCRA requires you to make additional disclosures related to the numerical credit score.

However, because the information you used did not include a numerical credit score, you do not need to make any of those disclosures. Supplementary Information, Appendix C to Part 202—Sample Notification Forms, 76 Fed. Reg. 41590, 41593 (July 15, 2011). (You should  make the other disclosures that FCRA requires when you use a consumer report, such as disclosure of the consumer’s right to obtain a free credit report and to dispute the accuracy or completeness of a credit report. 15 USC 1681m(a)(4).)