Consumer Reporting FAQs Related to the CARES Act and COVID-19 Pandemic

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Article Highlights:

The Consumer Financial Protection Bureau (the Bureau) published a 7 page document with 10 frequently asked questions and answers.

  1. The Bureau recapped the Statement on Supervisory and Enforcement Priorities Regarding the Fair Credit Reporting Act and Regulation V in Light of the CARES Act. The Statement requires furnishers, including mortgage services who report to the credit reporting agencies, to report “a consumer whose account was not previously delinquent” as current if they receive an accommodation and made any payments required by the accommodation.  It also indicates that the Bureau would “consider individual circumstances” in evaluating compliance with FCRA requirements regarding disputes.
  2. The Bureau will continue its commitment to enforcing FCRA, as amended by the CARES Act, even while considering circumstances faced by entities. Good faith efforts to comply with statutory and regulatory obligations will be evaluated on an individual basis.  The Bureau will “not hesitate to take public enforcement action” that violate FCRA or other laws.
  3. The Bureau will evaluate good faith efforts to investigate disputes as quickly as possible on an individual basis.
  4. The Bureau clarified an accommodation as “any payment assistance or relief granted to a consumer who is affected by the COVID-19 pandemic during the period from January 31, 2020 until 120 days after the termination of the COVID-19 national emergency”.
  5. The Bureau stated that accommodations must be provided to consumers with Federally backed mortgage loans and Federally held student loans. The Bureau encourages financial institutions to work with impacted borrowers even if accommodations are not required under the CARES Act.
  6. The Bureau further clarified that accounts that were current before an accommodate must be reporting as current during the accommodation. If it was delinquent, the furnisher cannot advance the delinquent status.
  7. The Bureau reminded credit furnishers that multiple data fields may need to be updated to accurately reflect the required account status.
  8. The Bureau stated that furnishing a special comment code indicating that a consumer was impacted by a disaster or is in forbearance is not a substitute for complying with reporting that the account is current and not advancing the delinquency status.
  9. The Bureau stated that furnishers should not report that accounts are in forbearance if they are not (bulk reporting of like products). The Bureau reminds furnishers that FCRA and Regulation V requires accurate reporting.
  10. The Bureau restated that protections under the CARES Act continue to apply even if the accommodation ends prior to the protection period of the CARES Act.