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Most businesses intend to consummate a deal for financing every time a hard-pull credit report is requested. However, when that transaction is not consummated, there is an obligation to send an Adverse Action notice to the applicant within a 30-day time frame.That’s when problems arise. Regardless of the number of Adverse Action letters you are mandated to send or deliver, the in-house process requires a dedicated employee or additional resources that don’t exist in the budget. When it comes to regulatory compliance, is it worth the financial risk and the negative effects of an Adverse Action notice slipping through the cracks? And let’s not forget the cost of postage stamps is always increasing.That’s when problems arise. Regardless of the number of Adverse Action letters you are mandated to send or deliver, the in-house process requires a dedicated employee or additional resources that don’t exist in the budget. When it comes to regulatory compliance, is it worth the financial risk and the negative effects of an Adverse Action notice slipping through the cracks? And let’s not forget the cost of postage stamps are always increasing.With all that in mind, we developed the most advanced and most SECURE method of sending Adverse Action notices via email or text message, at a fraction of the cost of traditional methods.Current delivery methods offered by other providers limit your business to producing Adverse Action letters at the time of the credit pull, before submitting the application to lenders, or relying on a process of snail-mailing letters within 30 days of the credit pull.Eliminate the burden today with our electronic delivery service. Don’t worry, if for any reason we cannot electronically deliver a notice, we have a fail-safe backup that will send it via snail mail in the time frame allowed by law.The setup process is...
Adverse Action SimplifiedAdverse Action notices are by far the most misunderstood of all compliance regulations. To put it in the simplest terms, Adverse Action is an explanation of credit denial or the inability to come to acceptable terms by either the creditor offering credit terms or the applicant’s counteroffer of credit terms.You must provide an Adverse Action notice to inform the applicant or applicants that a decision of credit or denial of terms has been reached. The content of the letter includes the reason code(s) provided from the CRA or credit reporting agency or agencies.Adverse Action Notices Explainedin part with ECOA (Regulation B) Part 1002.2 and additional sources.An Adverse Action Notice must be produced within 30 days of the date the credit report is obtained based on the explanation above. If a counteroffer is deemed to be unacceptable by the customer, the Notice must be provided to the customer within 90 days after delivering the counteroffer. The ECOA does not specify how the Notices are to be delivered. But they advise to deliver in person, by regular mail, by fax or electronically. Note that a customer accepting a counteroffer of credit, no matter how unfavorable, negates "adverse action" under the ECOA definition. If that doesn't happen, either because no lender approved the customer or the customer refused all credit offered, you are stuck with an adverse action situation. See the official Federal Trade Commission ruling here.Who is required?Creditors are generally required under the Equal Credit Opportunity Act and Regulation B to notify applicants within 30 days of receiving a “completed application” of the creditor’s approval, counteroffer, denial or other adverse notice regarding the application. Regulation B notifications of action taken are designed to help consumers and businesses by providing transparency to the credit underwriting process in a timely manner. Information that is generally...
Our eClear Credit Risk Report is an “alternative credit data” credit report that is designed primarily for buy-here-pay-here dealers and automotive lenders in the subprime space. ...