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Reply To: RBP Exception Notice on Denial

#5649
rcooper
Member

Just to clarify:
My response above is the safe approach, but not the only one. If you are relying on the AAN exception ensure that the Notice to Home Loan Applicant is provided to applicants when applicable. Also, when relying on the AAN exception keep in mind, the credit score disclosure exception notice is required to be given as soon as reasonably practicable or no later than consummation or first transaction for open end credit. If you deny the loan before you would normally provide the exception notice I think the adverse action would be fine. If you deny it 25 days after you pull the credit report, you probably should’ve complied with the credit score exception notice (I’m assuming you give it as soon as reasonably practicable which, in my example above, would be before the AAN) and then still give the AAN when the application is denied.

These are two good resources:
https://www.philadelphiafed.org/bank-resources/publications/consumer-compliance-outlook/2013/second-quarter/adverse-action-notice-requirements-under-ecoa-fcra.cfm

https://www.philadelphiafed.org/bank-resources/publications/consumer-compliance-outlook/2012/first-quarter/risk-based-pricing-notice-requirements.cfm