Pub. 3 2012 Issue 1

www.wvbankers.org 18 (CRA), the Fed has indicated that the CRA is in the best posi- tion to identify the key factors that affected the score and that the bank could rely on such information in preparing its dis- closure. The regulation does not compel the CRA to provide such factors to a bank, making it a contractual matter between the bank and its CRA. It is important to understand that disclosing the key factors adversely affecting the credit score fulfills only the requirements of FCRA as amended by Dodd- Frank. It does not satisfy the requirements under ECOA to disclose specific factors or reasons for the denying the credit. In some cases the factors reducing the credit score and reasons for taking adverse action may be the same. In other cases, the reasons for denial may be unrelated to the credit score, such as the debt-to-income ratio or length of employment not meeting bank guidelines. Therefore, both the factors contributing to a less-than-perfect credit score and the reasons for denial must be disclosed. If a bank obtains a credit report but does not obtain a credit score — or obtains one but does not use it in taking adverse action — then the bank is not required to disclose such score or related information. If a bank uses a “proprietary score,” that is one developed in house, it is also subject to the same require- ments. However, in-house scores that use information from a credit report plus other factors, loan-to-value or liquid assets, as examples, would not fall under the definition of proprietary score in Section 1100F of Dodd-Frank. If a bank requests a credit score, but none is available, the bank is not required to make the credit score related disclosures. MORE THAN ONE CONSUMER Regulation B permits a bank to provide only one adverse ac- tion notice when an application has 2 or more co-applicants. That provision contrasts with FCRA where a bank is re- quired to provide notice to “any consumer” being the subject New Name. Familiar Service. Converge is CenterState Bank’s innovative web-based online banking platform and is the access point for our Clearing/Cash Management Solution. Converge services include: For more information regarding Converge, please contact your Business Development Officer. 120 Club Oaks Court, Suite 150 Winston-Salem, NC 27104 336.659.7100 y 877.604.8282 www.csbcorrespondent.com Account Information Domestic Wires OFAC Email Notification ACH Services FRB Services International Services The use of credit scores may be an effective method for underwriting loans, deciding whether to open new deposit accounts or making a hiring decision.