Topic: Risk-Based Pricing
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Are joint (merged) credit reports allowed for joint consumer loans? For example, if two applicants have indicated their intent to jointly apply for credit, and each applicant’s income and assets will be used as a basis for our underwriting, may we obtain a joint credit report? If so, are there any privacy concerns regarding providing a joint report to two parties, and do different rules apply to married applicants? Also, Fannie Mae and Freddie Mac require “tri-merge” credit reports — does this pose any concerns?
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Yes, you may obtain a merged credit report for co-applicants, in which vendors merge the information from two individuals’ credit reports — subject to the caveat that there may be some fair lending concerns if your vendor offers joint reports for married couples at a lower cost than separate credit reports for unmarried individuals. The…
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Does the risk-based pricing notice have to be signed by the customer and documented in the loan file?
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No, we are not aware of any requirement for customers to sign the risk-based pricing notice or for a copy of the notice to be retained by your bank. We are aware that some banks do have a policy that requires customer signatures on the notices, along with a document retention policy for retaining such…