New Rule Requires Lenders to Provide Credit Scores to Consumers
News from ABC News:
Starting today, lenders who deny a borrower credit or offer a higher-than-normal interest rate are required to show the borrower his credit score.
The new rule is part of an amendment to the Dodd-Frank Wall Street Reform and Consumer Protection Act that passed exactly one year ago. Introduced by Sen. Mark Udall, D-Colo., it requires creditors to provide additional information in adverse action notices if a credit score was used in making a credit decision.
Udall said the credit scores to which consumers previously had access were often not the same as those lenders used to gauge an applicant’s creditworthiness. Bad credit scores, of course, can mean higher interest rates and less-favorable loan terms.
Now when lenders such as banks or credit card companies use credit scores to deny credit or offer an unusually high interest rates, they must disclose not only the relevant scores to the borrowers but also what influenced how their scores were arrived at, the range…………… continues on ABC News
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