The Federal Reserve recently issued final rules requiring credit unions to provide an amended risk based pricing notice that includes a credit score if that information is used to set material terms of credit. Similarly, the Federal Reserve issued a final rule requiring credit unions to provide an amended adverse action notice that includes a credit score, if such information is used to take an adverse action.
There has been a bit of uncertainty surrounding the effective date of these changes. Under the Dodd-Frank statute, the amendments to risk based pricing notices and adverse action notices become effective on July 21, 2011. The final rules, which were issued on July 6th, indicate that the final rules take effect 30 days after the final rules are published in the Federal Register. At this time, the final rules have not been published in the Federal Register, but we anticipate that will occur soon.
After internal discussion and a conversation with CUNA, it is the recommendation of the Regulatory Affairs Department that credit unions strive to comply as of July 21st, to the extent that it is possible. If that is not possible, complying by the final rule’s effective date appears to be permissible in the eyes of the Federal Reserve.