01/2010 – Compliance Update

By S.R. Snodgrass Outsourcing Group

Fact Act Risk-Based Pricing Rules; RESPA Revision to GFE and Settlement Statement; Regulation CC Changes; Internet Gambling; Regulation Z Open-End Consumer Credit Changes; Model Privacy Form Final Rule; Federal Reserve Announces a Final Rule to Protect Consumers; SAFE Act

FACT ACT RISK-BASED PRICING RULES

The rule, as required under Section 311 of the FACT Act regarding implementation of the risk-based pricing rules, was published in the federal register on December 22, 2009. The rule requires a notice to be provided to consumers who receive loan terms that are less favorable than for other consumers, based on their credit reports. The rule also provides that, along with the notice, if applicable and issued, the consumer is also able to obtain a free credit report. There are different methods by which a lender can make determinations on those affected borrowers who should receive such notices. The lender will also have a choice of providing consumers a free credit score and information about their score, in lieu of the required risk-based pricing notice. The effective date of these provisions is January 1, 2011.