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Fair Credit Reporting: 3.3.10.3 Nature of Scores Sold

The CRA can disclose to the consumer either the current score or the most recent score that the CRA had calculated for a creditor.287 The score must either (a) be generated using a scoring model that is widely distributed to users by the CRA or (b) assist the consumer in understanding the assessment by the credit scoring model of their credit behavior and predications about that behavior.288 Note that the latter option means that the credit score provided by the CRA may not necessarily be the sa

Fair Credit Reporting: 3.3.2.2 Timing, Volume, and Identification Requirements

Both nationwide CRAs and nationwide specialty CRAs must provide free annual reports within fifteen days after the date on which the request is received.139 They must have adequate capacity to meet a reasonably anticipated volume of consumer requests,140 with adequate contingency plans for reasonably likely situations that might increase demand.141 Regulation V makes certain provisions where request volume exceeds any reasonable anticipation.

Fair Credit Reporting: 3.3.1.3.3 User disclosure where information obtained from a person other than a consumer reporting agency leads to credit denial or an increase in credit charges

Whenever consumer credit is denied, based at least in part on information obtained from a person other than a CRA, the creditor, when communicating the fact of the adverse credit action, must clearly and accurately disclose the consumer’s right to obtain information about the reasons for the adverse credit action.107 The consumer can send a written request for the reasons for the adverse action, if that request is received within sixty days of the consumer learning of the adverse action.108

Fair Credit Reporting: 3.3.1.1 Advantages

While a report can be obtained as a matter of right from a CRA, there are advantages in obtaining the report directly from a creditor or other entity that has recently used the consumer report. The user’s report is the actual report that was the basis for the adverse action, not a report generated at a later date that may be significantly different than the report relied upon by the user.

Fair Credit Reporting: 3.3.10.4 Disclosure of Key Factors

In addition to the credit score itself, the CRA must disclose the top four key factors (and no more) that adversely affected the credit score, listed in order of importance.298 In addition, the CRA must also disclose if the number of inquiries on a consumer’s file adversely affected the score, even if it was not one of the four top reasons.299 However, “check services companies” (e.g., a check verification agency) are excluded from the requirement to disclose inquiries as a key factor.

Fair Credit Reporting: 3.3.9.2 Legal Limits on the Price of a Report

The FCRA states that the charge for a consumer file disclosure shall be reasonable and not exceed eight dollars, adjusted annually for inflation.256 For 2023, the Consumer Financial Protection Bureau has set the maximum allowable charge as fourteen dollars and fifty cents, an increase of one dollar from 2022.257 Note that lenders and other users usually pay far lower prices for consumer reports, fr

Fair Credit Reporting: 3.3.1.3.4 Credit scores disclosure in adverse action and risk-based pricing notices

Creditors, when providing an adverse action110 or risk-based notice,111 must include in that notice the actual credit score used in making the credit decision.112 While the statutory language appears to apply to any user required to give an adverse action notice, including insurers and others, it also uses a definition of a credit score that is limited to scores for “predicting credit behaviors.”113 T

Fair Credit Reporting: 3.3.5 Free Report Following Adverse Action

When a user takes an adverse action relating to credit, insurance, or employment, in part because of information in a consumer report, the user must provide an adverse action notice to the consumer.224 This notice must include the name and address of the CRA that supplied the consumer report.225 The consumer has sixty days to request a free consumer report from the CRA referenced in the notice.226

Fair Credit Reporting: 3.3.10.5 Fee for a Credit Score

The CRA can charge a fair and reasonable fee, as determined by the Consumer Financial Protection Bureau.302 Previously, this provision allowed the Federal Trade Commission to set the fee, and the FTC issued an Advanced Notice of Proposed Rulemaking (ANPR) in 2004.303 However, the FTC never established or even issued a proposal setting this fee.

Fair Credit Reporting: 3.3.2.4 Free Annual Disclosures From Specialty Consumer Reporting Agencies

A nationwide specialty consumer reporting agency must provide a toll-free telephone number and a streamlined process for consumers to request their reports.168 The toll-free telephone number must appear in all telephone directories where the CRA’s other phone numbers appear169 and be prominently posted on any website owned or maintained by the CRA.170 The streamlined process must provide clear and prominent instructions for requesting a report by a

Fair Credit Reporting: 3.3.9.3 Time Within Which Report Must Be Provided

Federal law requires that the first free annual report be provided within fifteen days, and reports following an identity theft notification must be made within three days.268 The FCRA, though, does not specify a time period for other types of report requests. Nevertheless, undue delays are not permissible.

Fair Credit Reporting: 3.3.10.6 Arbitration; Preemption

CRAs often include an arbitration requirement when the consumer purchases the credit score.306 The arbitration agreement supposedly prevents the consumer from bringing any court action against the CRA, even if the court action is unrelated to the credit score.307 Consumers should be wary of agreeing to such a restriction of their basic rights in exchange for obtaining a credit score that may not even be the same score utilized by creditors.308

Fair Credit Reporting: 3.3.10.1 Generally

One of the key items in a consumer’s file is a credit score, which is a single numerical representation of much of the information in the file.271 When the consumer requests a consumer report, whether it is pursuant to a free annual report, in response to an adverse credit action, or any other type of request, the CRA is not required to include a credit score with that report.272 Nevertheless, when the consumer makes a request for a report, the CRA must disclose that the consumer can pay a fee a

Fair Credit Reporting: 3.3.1.4 Credit Scores Disclosure by Mortgage Lenders

The FCRA requires that mortgage lenders who use credit scores in connection with an application for residential real-estate-secured credit must provide, free of charge, the credit score and associated key factors that the lender used.128 The lender must provide either the score obtained from a CRA or a score developed and used by the lender.129 The Fourth Circuit has held that this requirement does not apply to a website that generated leads from consumers who inquired about mortgages on that we

Fair Credit Reporting: 3.3.11 Consumer’s Right to Access Information Under the Dodd-Frank Act

In addition to the right to obtain consumer disclosures under the FCRA, the Dodd-Frank Act established a new right, subject to rules that have not yet been proposed, for consumers to access any information in the control or possession of a “covered person” concerning a “consumer financial product or service” that the consumer obtained from the covered person.311 A “consumer financial product or service” includes, among many other things, any credit, deposit account or stored value card provided to a consumer.

Fair Credit Reporting: 3.3.12 Enforceability of the Right to Obtain a Consumer Report

A consumer reporting agency’s violation of a consumer’s right to a copy of their consumer report is subject to the private remedies of the FCRA including claims for actual damages, punitive damages, costs, and attorney fees.318 However, a consumer must allege more than that the CRA failed to provide the consumer report under the heightened pleading standards set by the Supreme Court.319 Furthermore, the consumer must allege facts establishing a concrete and particularized injury in order to have

Fair Credit Reporting: 3.3.3.2 Scope of Requirement

Regulation V requires the mandatory disclosure to be made for all offers of a “free credit report.”187 A “free credit report” is specifically defined as a file disclosure from a nationwide CRA that is represented, either expressly or impliedly, to be free if the consumer purchases a product or service, or agrees to purchase a product or service subject to cancellation.188 By limiting the term to “file disclosures,” the rule excludes from its scope offers of a free credit score.