NAFCU: Fed forms need an update
NAFCU Senior Regulatory Counsel Tessema Tefferi
Aug. 26, 2013 – NAFCU Senior Regulatory Counsel Tessema Tefferi wrote the Board of Governors of the Federal Reserve System to recommend more “inclusive” language in forms collecting information about loan level data and credit scores.
Tefferi pointed out that the forms for which the Board requested comments only reference a borrower’s FICO score, when many lenders and credit reporting agencies use other credit scoring systems instead.
“We believe the exclusionary language used in the forms discourages competition and choice. As a consequence, many otherwise qualified consumers could be inappropriately left out of the credit market,” Tefferi wrote.
The forms in question, which all reference FICO scores, are the forms to collect data on domestic home equity loans and home equity lines, domestic first lien closed-end 1-4 family residential loans, and domestic credit cards.