The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
Federal R eserve B ank OF DALLAS W IL L IA M H . W ALLACE DALLAS, TEXAS 7 5 2 2 2 FIRST V IC E P R ES ID EN T AND CH IE F O PER ATING O FFIC ER May 1, 1990 C ircular 90-16 TO: The C hief Executive Officer of all financial institutions in the Eleventh Federal Reserve District SUBJECT R evised R eg u lation B and C pamphlets DETAILS The Board of Governors of the Federal Reserve System has published revised Regulation B and C pamphlets. The new pamphlets should be placed in Volume 2 of y o u r Regulations and Bulletins Binders and the old pamphlets should be removed. ENCLOSURES The revised Regulation B and C pamphlets are enclosed. MORE INFORMATION For additional copies of these regulations, please contact the Public Affairs Department at (214) 651-6289. Sincerely yours, For additional copies of any circu la r please co n ta ct the Public A ffa irs Department at (214) 651-6289. Banks and others are encouraged to use the fo llo w in g incom ing WATS numbers in con ta ctin g this Bank (800) 442-7140 (intrastate) and (800) 527-9200 (interstate). This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) Board of Governors of the Federal Reserve System Regulation B Equal Credit Opportunity 12 CFR 202; as revised effective December 8, 1989 Any inquiry relating to this regulation should be addressed to the Federal Reserve Bank of the District in which the inquiry arises. February 1990 Contents Page Section 202.1—Authority, purpose, scope 1 (a) Authority and s c o p e ................... 1 (b) Purpose......................................... 1 Section 202.2—Definitions....................... 1 Section 202.3—Limited exceptions for certain classes of transactions .............. 4 (a) Public-utilities cred it................... 4 (b) Securities c re d it........................... 4 (c) Incidental credit........................... 4 (d) Government credit ..................... 5 Section 202.4— General rule prohibiting discrimination........................................ 5 Section 202.5—Rules concerning taking of applications............................................ 5 (a) Discouraging applications........... 5 (b) General rules concerning requests for information.............................. 5 (c) Information about a spouse or former spouse................................ 5 (d) Other limitations on information requests.......................................... 6 (e) Written applications................... 6 Section 202.6—Rules concerning evaluation of applications...................... 6 (a) General rule concerning use of information .................................. 6 (b) Specific rules concerning use of information .................................. 6 (c) State property la w s ..................... 7 Section 202.7—Rules concerning extensions of c re d it................................ 7 (a) Individual accounts..................... 7 (b) Designation of n a m e ................... 7 (c) Action concerning existing openend accounts.................................. 7 (d) Signature of spouse or other person............................................ 8 (e) Insurance..................................... 8 Section 202.8—Special-purpose credit program s................................................ 8 (a) Standards for programs............... 8 (b) Rules in other sections................. 9 (c) Special rule concerning requests and use of information.................. 9 (d) Special rule in the case of financial need................................................ 9 Page Section 202.9—Notifications.................... 9 (a) Notification of action taken, ECOA notice, and statement of specific reasons.............................. 9 (b) Form of ECOA notice and statement of specific reasons........ 10 (c) Incomplete applications .............. 10 (d) Oral notifications by smallvolume c re d ito rs.......................... 11 (e) Withdrawal of approved application.................................... 11 (f) Multiple applicants...................... 11 (g) Applications submitted through a third p a r ty .................................... 11 Section 202.10—Furnishing of credit inform ation............................................ 11 (a) Designation of acco u n ts............. 11 (b) Routine reports to consumer reporting a g e n c y .......................... 11 (c) Reporting in response to inquiry . 11 Section 202.11—Relation to state law . . . . 12 (a) Inconsistent state laws................. 12 (b) Preempted provisions of state law 12 (c) Laws on finance charges, loan ceilings.......................................... 12 (d) State and federal laws not affected 12 (e) Exemption for state-regulated transactions.................................. 12 Section 202.12—Record retention........... 12 (a) Retention of prohibited information .................................. 12 (b) Preservation of reco rd s............... 12 Section 202.13—Information for monitoring purposes.............................. 13 (a) Information to be requested....... 13 (b) Obtaining of information ........... 14 (c) Disclosure to applicant (s) ......... 14 (d) Substitute monitoring program .. 14 Section 202.14— Enforcement, penalties, and liabilities.......................................... 14 (a) Administrative enforcement....... 14 (b) Penalties and liabilities............... 14 (c) Failure of com pliance................. 14 Contents Page Page Appendix A—Federal enforcement Appendix D—Issuance of staff agencies..................................................... 15 interpretations......................................... 31 Appendix B—Model application forms .. 15 Appendix C—Sample notification forms . 27 EQUAL CREDIT OPPORTUNITY A C T ......................................................... 33 Regulation B Equal Credit Opportunity 12 C FR 202; effective March 23,1977; as amended effective December 8, 1989* Section 202.1 Authority, scope, and purpose 202.2 Definitions 202.3 Limited exceptions for certain classes of transactions 202.4 General rule prohibiting discrimination 202.5 Rules concerning taking of applications 202.6 Rules concerning evaluation of applications 202.7 Rules concerning extensions of credit 202.8 Special-purpose credit programs 202.9 Notifications 202.10 Furnishing of credit information 202.11 Relation to state law 202.12 Record retention 202.13 Information for monitoring purposes 202.14 Enforcement, penalties, and liabilities (b) Purpose. The purpose of this regulation is to promote the availability of credit to all creditworthy applicants without regard to race, color, religion, national origin, sex, mari tal status, or age (provided the applicant has the capacity to contract); to the fact that all or part of the applicant’s income derives from a public assistance program; or to the fact that the applicant has in good faith exercised any right under the Consumer Credit Protection Act. The regulation prohibits creditor prac tices that discriminate on the basis of any of these factors. The regulation also requires creditors to notify applicants of action taken on their applications; to report credit history in the names of both spouses on an account; to retain records of credit applications; and to collect information about the applicant’s race and other personal characteristics in applica tions for certain dwelling-related loans. Appendix Appendix Appendix Appendix SECTION 202.2— Definitions A—Federal enforcement agencies B—Model application forms C—Sample notification forms D—Issuance of staff interpretations SECTION 202.1—Authority, Scope, and Purpose (a) Authority and scope. This regulation is is sued by the Board of Governors of the Feder al Reserve System pursuant to title VII (Equal Credit Opportunity Act) of the Con sumer Credit Protection Act, as amended (15 USC 1601 et seq.). Except as otherwise pro vided herein, the regulation applies to all per sons who are creditors, as defined in section 202.2 (/). Information-collection requirements contained in this regulation have been ap proved by the Office of Management and Bud get under the provisions of 44 USC 3501 et seq. and have been assigned OMB No. 7100-0201. * C reditors have the option o f continuing to comply with the previous version o f the regulation until A pril 1, 1990, when compliance with this amended version becomes mandatory. For the purposes of this regulation, unless the context indicates otherwise, the following defi nitions apply. (a) Account means an extension of credit. When employed in relation to an account, the word use refers only to open-end credit. (b) Act means the Equal Credit Opportunity Act (title VII of the Consumer Credit Protec tion Act). (c) Adverse action. (1) The term means— (i) a refusal to grant credit in substan tially the amount or on substantially the terms requested in an application unless the creditor makes a counteroffer (to grant credit in a different amount or on other terms) and the applicant uses or expressly accepts the credit offered; (ii) a termination of an account or an unfavorable change in the terms of an ac count that does not affect all or a sub stantial portion of a class of the creditor’s accounts; or 1 § 202.2 (iii) a refusal to increase the amount of credit available to an applicant who has made an application for an increase. (2) The term does not include— (i) a change in the terms of an account expressly agreed to by an applicant; (ii) any action or forbearance relating to an account taken in connection with in activity, default, or delinquency as to that account; (iii) a refusal or failure to authorize an account transaction at a point of sale or loan, except when the refusal is a termi nation or an unfavorable change in the terms of an account that does not affect all or a substantial portion of a class of the creditor’s accounts, or when the re fusal is a denial of an application for an increase in the amount of credit available under the account; (iv) a refusal to extend credit because applicable law prohibits the creditor from extending the credit requested; or (v) a refusal to extend credit because the creditor does not offer the type of credit or credit plan requested. (3) An action that falls within the defini tion of both paragraphs (c)(1 ) and (c)(2 ) of this section is governed by paragraph (c)(2 ). (d) Age refers only to the age of natural per sons and means the number of fully elapsed years from the date of an applicant’s birth. (e) Applicant means any person who requests or who has received an extension of credit from a creditor, and includes any person who is or may become contractually liable regard ing an extension of credit. For purposes of section 202.7(d), the term includes guaran tors, sureties, endorsers and similar parties. (f) Application means an oral or written re quest for an extension of credit that is made in accordance with procedures established by a creditor for the type of credit requested. The term does not include the use of an account or line of credit to obtain an amount of credit that is within a previously established credit limit. A completed application means an appli cation in connection with which a creditor has received all the information that the creditor 2 Regulation B regularly obtains and considers in evaluating applications for the amount and type of credit requested (including, but not limited to, cred it reports, any additional information request ed from the applicant, and any approvals or reports by governmental agencies or other persons that are necessary to guarantee, in sure, or provide security for the credit or col lateral). The creditor shall exercise reasonable diligence in obtaining such information. (g) Business credit refers to extensions of credit primarily for business or commercial (including agricultural) purposes, but exclud ing extensions of credit of the types described in section 202.3(a), (b), and (d). (h) Consumer credit means credit extended to a natural person primarily for personal, family, or household purposes. (i) Contractually liable means expressly obli gated to repay all debts arising on an account by reason of an agreement to that effect. (j) Credit means the right granted by a credi tor to an applicant to defer payment of a debt, incur debt and defer its payment, or purchase property or services and defer payment therefor. (k) Credit card means any card, plate, cou pon book, or other single credit device that may be used from time to time to obtain mon ey, property, or services on credit. (/) Creditor means a person who, in the ordi nary course of business, regularly participates in the decision of whether or not to extend credit. The term includes a creditor’s assignee, transferee, or subrogee who so participates. For purposes of sections 202.4 and 202.5(a), the term also includes a person who, in the ordinary course of business, regularly refers applicants or prospective applicants to credi tors, or selects or offers to select creditors to whom requests for credit may be made. A per son is not a creditor regarding any violation of the act or this regulation committed by anoth er creditor unless the person knew or had rea sonable notice of the act, policy, or practice that constituted the violation before becoming involved in the credit transaction. The term does not include a person whose only partici Regulation B pation in a credit transaction involves honor ing a credit card. (m) Credit transaction means every aspect of an applicant’s dealings with a creditor regard ing an application for credit or an existing ex tension of credit (including, but not limited to, information requirements; investigation procedures; standards of creditworthiness; terms of credit; furnishing of credit informa tion; revocation, alteration, or termination of credit; and collection procedures). (n) Discriminate against an applicant means to treat an applicant less favorably than other applicants. (o) Elderly means age 62 or older. (p) Empirically derived and other credit scor ing systems. (1) A credit scoring system is a system that evaluates an applicant’s creditworthiness mechanically, based on key attributes of the applicant and aspects of the transaction, and that determines, alone or in conjunc tion with an evaluation of additional infor mation about the applicant, whether an ap plicant is deemed creditworthy. To qualify as an empirically derived, demonstrably and statistically sound, credit scoring system, the system must be— (i) based on data that are derived from an empirical comparison of sample groups or the population of creditworthy and noncreditworthy applicants who ap plied for credit within a reasonable pre ceding period of time; (ii) developed for the purpose of evalu ating the creditworthiness of applicants with respect to the legitimate business in terests of the creditor utilizing the system (including, but not limited to, minimiz ing bad debt losses and operating expens es in accordance with the creditor’s busi ness judgment); (iii) developed and validated using ac cepted statistical principles and method ology; and (iv) periodically revalidated by the use of appropriate statistical principles and methodology and adjusted as necessary to maintain predictive ability. (2) A creditor may use an empirically de § 202.2 rived, demonstrably and statistically sound, credit scoring system obtained from anoth er person or may obtain credit experience from which to develop such a system. Any such system must satisfy the criteria set forth in paragraph (p) (1) (i) through (iv) of this section; if the creditor is unable dur ing the development process to validate the system based on its own credit experience in accordance with paragraph (p) (1) of this section, the system must be validated when sufficient credit experience becomes available. A system that fails this validity test is no longer an empirically derived, demonstra bly and statistically sound, credit scoring system for that creditor. (q) Extend credit and extension o f credit mean the granting of credit in any form (in cluding, but not limited to, credit granted in addition to any existing credit or credit limit; credit granted pursuant to an open-end credit plan; the refinancing or other renewal of cred it, including the issuance of a new credit card in place of an expiring credit card or in substi tution for an existing credit card; the consoli dation of two or more obligations; or the con tinuance of existing credit without any special effort to collect at or after maturity). (r) Good faith means honesty in fact in the conduct or transaction. (s) Inadvertent error means a mechanical, electronic, or clerical error that a creditor demonstrates was not intentional and oc curred notwithstanding the maintenance of procedures reasonably adapted to avoid such errors. (t) Judgmental system o f evaluating appli cants means any system for evaluating the creditworthiness of an applicant other than an empirically derived, demonstrably and statis tically sound, credit scoring system. (u) Marital status means the state of being unmarried, married, or separated, as defined by applicable state law. The term “unmar ried” includes persons who are single, di vorced, or widowed. (v) Negative factor or value, in relation to the age of elderly applicants, means utilizing a 3 § 202.2 factor, value, or weight that is less favorable regarding elderly applicants than the credi tor’s experience warrants or is less favorable than the factor, value, or weight assigned to the class of applicants that are not classified as elderly and are most favored by a creditor on the basis of age. (w) Open-end credit means credit extended under a plan under which a creditor may per mit an applicant to make purchases or obtain loans from time to time directly from the creditor or indirectly by use of a credit card, check, or other device. (x) Person means a natural person, corpora tion, government or governmental subdivision or agency, trust, estate, partnership, coopera tive, or association. (y) Pertinent element o f creditworthiness, in relation to a judgmental system of evaluating applicants, means any information about ap plicants that a creditor obtains and considers and that has a demonstrable relationship to a determination of creditworthiness. (z) Prohibited basis means race, color, reli gion, national origin, sex, marital status, or age (provided that the applicant has the ca pacity to enter into a binding contract); the fact that all or part of the applicant’s income derives from any public assistance program; or the fact that the applicant has in good faith exercised any right under the Consumer Cred it Protection Act or any state law upon which an exemption has been granted by the Board. (aa) State means any state, the District of Columbia, the Commonwealth of Puerto Rico, or any territory or possession of the United States. SECTION 202.3— Limited Exceptions for Certain Classes of Transactions (a) Public-utilities credit. (1) Definition. Public-utilities credit refers to extensions of credit that involve public-utility services provided through pipe, wire, or other con nected facilities, or radio or similar trans mission (including extensions of such facili ties), if the charges for service, delayed 4 Regulation B payment, and any discount for prompt pay ment are filed with or regulated by a gov ernment unit. (2) Exceptions. The following provisions of this regulation do not apply to publicutilities credit: (i) section 202.5(d)(1) concerning in formation about marital status; (ii) section 202.10 relating to furnishing of credit information; and (iii) section 202.12(b) relating to record retention. (b) Securities credit. (1) Definition. Securi ties credit refers to extensions of credit sub ject to regulation under section 7 of the Se curities Exchange Act of 1934 or extensions of credit by a broker or dealer subject to regulation as a broker or dealer under the Securities Exchange Act of 1934. (2) Exceptions. The following provisions of this regulation do not apply to securities credit: (i) section 202.5(c) concerning infor mation about a spouse or former spouse; (ii) section 202.5(d)(1) concerning in formation about marital status; (iii) section 202.5(d)(3) concerning in formation about the sex of an applicant; (iv) section 202.7(b) relating to desig nation of name, but only to the extent necessary to prevent violation of rules re garding an account in which a broker or dealer has an interest, or rules necessitat ing the aggregation of accounts of spous es for the purpose of determining controlling interests, beneficial interests, beneficial ownership, or purchase limita tions and restrictions; (v) section 202.7(c) relating to action concerning open-end accounts, but only to the extent the action taken is on the basis of a change of name or marital status; (vi) section 202.7(d) relating to the sig nature of a spouse or other person; (vii) section 202.10 relating to furnish ing of credit information; and (viii) section 202.12(b) relating to rec ord retention. (c) Incidental credit. (1) Definition. Inciden tal credit refers to extensions of consumer Regulation B credit other than credit of the types de scribed in paragraphs (a) and (b) of this section— (i) that are not made pursuant to the terms of a credit card account; (ii) that are not subject to a finance charge (as defined in Regulation Z, 12 CFR 226.4); and (iii) that are not payable by agreement in more than four installments. (2) Exceptions. The following provisions of this regulation do not apply to incidental credit: (i) section 202.5(c) concerning infor mation about a spouse or former spouse; (ii) section 202.5(d)(1) concerning in formation about marital status; (iii) section 202.5(d)(2) concerning in formation about income derived from ali mony, child support, or separate mainte nance payments; (iv) section 202.5(d)(3) concerning in formation about the sex of an applicant, but only to the extent necessary for medi cal records or similar purposes; (v) section 202.7(d) relating to the sig nature of a spouse or other person; (vi) section 202.9 relating to notifications; (vii) section 202.10 relating to furnish ing of credit information; and (viii) section 202.12(b) relating to rec ord retention. (d) Government credit. (1) Definition. Gov ernment credit refers to extensions of credit made to governments or governmental sub divisions, agencies, or instrumentalities. (2) Applicability o f regulation. Except for section 202.4, the general rule prohibiting discrimination on a prohibited basis, the re quirements of this regulation do not apply to government credit. SECTION 202.4— General Rule Prohibiting Discrimination A creditor shall not discriminate against an applicant on a prohibited basis regarding any aspect of a credit transaction. § 202.5 SECTION 202.5—Rules Concerning Taking of Applications (a) Discouraging applications. A creditor shall not make any oral or written statement, in advertising or otherwise, to applicants or prospective applicants that would discourage on a prohibited basis a reasonable person from making or pursuing an application. (b) General rules concerning requests fo r information. (1) Except as provided in para graphs (c) and (d) of this section, a credi tor may request any information in connec tion with an application.1 (2) Required collection o f information. Notwithstanding paragraphs (c) and (d) of this section, a creditor shall request in formation for monitoring purposes as re quired by section 202.13 for credit secured by the applicant’s dwelling. In addition, a creditor may obtain information required by a regulation, order, or agreement issued by, or entered into with, a court or an en forcement agency (including the attorney general of the United States or a similar state official) to monitor or enforce compli ance with the act, this regulation, or other federal or state statute or regulation. (3) Special-purpose credit. A creditor may obtain information that is otherwise re stricted to determine eligibility for a special-purpose credit program, as provided in section 202.8(c) and (d). (c) Information about a spouse or form er spouse. (1) Except as permitted in this para graph, a creditor may not request any infor mation concerning the spouse or former spouse of an applicant. (2) Permissible inquiries. A creditor may request any information concerning an ap plicant’s spouse (or former spouse under paragraph (c )(2 )(v )) that may be request ed about the applicant if— (i) the spouse will be permitted to use the account; (ii) the spouse will be contractually lia ble on the account; 1 This paragraph does not limit or abrogate any federal o r state law regarding privacy, privileged information, credit reporting limitations, or similar restrictions on ob tainable information. 5 § 202.5 (iii) the applicant is relying on the spouse’s income as a basis for repayment of the credit requested; (iv) the applicant resides in a communi ty property state or property on which the applicant is relying as a basis for re payment of the credit requested is located in such a state; or (v) the applicant is relying on alimony, child support, or separate maintenance payments from a spouse or former spouse as a basis for repayment of the credit requested. (3) Other accounts o f the applicant. A creditor may request an applicant to list any account upon which the applicant is li able and to provide the name and address in which the account is carried. A creditor may also ask the names in which an appli cant has previously received credit. (d) Other limitations on information requests. (1) Marital status. If an applicant applies for individual unsecured credit, a creditor shall not inquire about the applicant’s marital status unless the applicant resides in a com munity property state or is relying on prop erty located in such a state as a basis for repayment of the credit requested. If an ap plication is for other than individual unse cured credit, a creditor may inquire about the applicant’s marital status, but shall use only the terms “married,” “unmarried,” and “separated.” A creditor may explain that the category “unmarried” includes sin gle, divorced, and widowed persons. (2) Disclosure about income from alimony, child support, or separate maintenance. A creditor shall not inquire whether income stated in an application is derived from ali mony, child support, or separate mainte nance payments unless the creditor disclos es to the applicant that such income need not be revealed if the applicant does not want the creditor to consider it in determin ing the applicant’s creditworthiness. (3) Sex. A creditor shall not inquire about the sex of an applicant. An applicant may be requested to designate a title on an appli cation form (such as Ms., Miss, Mr., or Mrs.) if the form discloses that the designa tion of a title is optional. An application Regulation B form shall otherwise use only terms that are neutral as to sex. (4) Childbearing, childrearing. A creditor shall not inquire about birth control prac tices, intentions concerning the bearing or rearing of children, or capability to bear children. A creditor may inquire about the number and ages of an applicant’s depen dents or about dependent-related financial obligations or expenditures, provided such information is requested without regard to sex, marital status, or any other prohibited basis. (5) Race, color, religion, national origin. A creditor shall not inquire about the race, color, religion, or national origin of an ap plicant or any other person in connection with a credit transaction. A creditor may inquire about an applicant’s permanent res idence and immigration status. (e) Written applications. A creditor shall take written applications for the types of credit covered by section 202.13(a) but need not take written applications for other types of credit. SECTION 202.6— Rules Concerning Evaluation of Applications (a) General rule concerning use o f informa tion. Except as otherwise provided in the act and this regulation, a creditor may consider any information obtained, so long as the infor mation is not used to discriminate against an applicant on a prohibited basis.2 (b) Specific rules concerning use o f informa tion. (1) Except as provided in the act and this regulation, a creditor shall not take a prohibited basis into account in any system of evaluating the creditworthiness of applicants. (2) Age, receipt o f public assistance, (i) Ex cept as permitted in this paragraph, a creditor shall not take into account an applicant’s age (provided that the appli 2 The legislative history of the act indicates that the Con gress intended an “ effects test” concept, as outlined in the employment field by the Supreme C ourt in the cases of Griggs v. D uke Power Co., 401 U.S. 424 (1971), and Albe m arle Paper Co. v. Moody, 422 U.S. 405 (1975), to be applicable to a creditor’s determ ination of creditworthiness. Regulation B cant has the capacity to enter into a bind ing contract) or whether an applicant’s income derives from any public assist ance program. (ii) In an empirically derived, demon strably and statistically sound, credit scoring system, a creditor may use an ap plicant’s age as a predictive variable, pro vided that the age of an elderly applicant is not assigned a negative factor or value. (iii) In a judgmental system of evaluat ing creditworthiness, a creditor may con sider an applicant’s age or whether an ap plicant’s income derives from any public assistance program only for the purpose of determining a pertinent element of creditworthiness. (iv) In any system of evaluating credit worthiness, a creditor may consider the age of an elderly applicant when such age is used to favor the elderly applicant in extending credit. (3) Childbearing, childrearing. In evaluat ing creditworthiness, a creditor shall not use assumptions or aggregate statistics re lating to the likelihood that any group of persons will bear or rear children or will, for that reason, receive diminished or inter rupted income in the future. (4) Telephone listing. A creditor shall not take into account whether there is a tele phone listing in the name of an applicant for consumer credit but may take into ac count whether there is a telephone in the applicant’s residence. (5) Income. A creditor shall not discount or exclude from consideration the income of an applicant or the spouse of an appli cant because of a prohibited basis or be cause the income is derived from part-time employment or is an annuity, pension, or other retirement benefit; a creditor may consider the amount and probable continu ance of any income in evaluating an appli cant’s creditworthiness. When an applicant relies on alimony, child support, or separate maintenance payments in applying for cred it, the creditor shall consider such pay ments as income to the extent that they are likely to be consistently made. (6) Credit history. To the extent that a creditor considers credit history in evaluat § 202.7 ing the creditworthiness of similarly quali fied applicants for a similar type and amount of credit, in evaluating an appli cant’s creditworthiness a creditor shall con sider— (i) the credit history, when available, of accounts designated as accounts that the applicant and the applicant’s spouse are permitted to use or for which both are contractually liable; (ii) on the applicant’s request, any infor mation the applicant may present that tends to indicate that the credit history being considered by the creditor does not accurately reflect the applicant’s credit worthiness; and (iii) on the applicant’s request, the cred it history, when available, of any account reported in the name of the applicant’s spouse or former spouse that the appli cant can demonstrate accurately reflects the applicant’s creditworthiness. (7) Immigration status. A creditor may consider whether an applicant is a perma nent resident of the United States, the ap plicant’s immigration status, and any addi tional information that may be necessary to ascertain the creditor’s rights and remedies regarding repayment. (c) State property laws. A creditor’s consider ation or application of state property laws di rectly or indirectly affecting creditworthiness does not constitute unlawful discrimination for the purposes of the act or this regulation. SECTION 202.7—Rules Concerning Extensions of Credit (a) Individual accounts. A creditor shall not refuse to grant an individual account to a creditworthy applicant on the basis of sex, marital status, or any other prohibited basis. (b) Designation o f name. A creditor shall not refuse to allow an applicant to open or main tain an account in a birth-given first name and a surname that is the applicant’s birth-given surname, the spouse’s surname, or a combined surname. (c) Action concerning existing open-end ac counts. (1) Limitations. In the absence of evi7 § 202.7 dence of the applicant’s inability or unwill ingness to repay, a creditor shall not take any of the following actions regarding an applicant who is contractually liable on an existing open-end account on the basis of the applicant’s reaching a certain age or re tiring or on the basis of a change in the applicant’s name or marital status: (i) require a reapplication, except as provided in paragraph (c )(2 ) of this section; (ii) change the terms of the account; or (iii) terminate the account. (2) Requiring reapplication. A creditor may require a reapplication for an open-end account on the basis of a change in the mar ital status of an applicant who is contractu ally liable if the credit granted was based in whole or in part on income of the appli cant’s spouse and if information available to the creditor indicates that the applicant’s income may not support the amount of credit currently available. (d) Signature o f spouse or other person. (1) Rule fo r qualified applicant. Except as pro vided in this paragraph, a creditor shall not require the signature of an applicant’s spouse or other person, other than a joint applicant, on any credit instrument if the applicant qualifies under the creditor’s stan dards of creditworthiness for the amount and terms of the credit requested. (2) Unsecured credit. If an applicant re quests unsecured credit and relies in part upon property that the applicant owns jointly with another person to satisfy the creditor’s standards of creditworthiness, the creditor may require the signature of the other person only on the instrument(s) necessary, or reasonably believed by the creditor to be necessary, under the law of the state in which the property is located, to enable the creditor to reach the property being relied upon in the event of the death or default of the applicant. (3) Unsecured credit—community property states. If a married applicant requests unse cured credit and resides in a community property state, or if the property upon which the applicant is relying is located in such a state, a creditor may require the sig Regulation B nature of the spouse on any instrument nec essary, or reasonably believed by the credi tor to be necessary, under applicable state law to make the community property avail able to satisfy the debt in the event of de fault if— (i) applicable state law denies the appli cant power to manage or control suffi cient community property to qualify for the amount of credit requested under the creditor’s standards of creditworthiness; and (ii) the applicant does not have suffi cient separate property to qualify for the amount of credit requested without re gard to community property. (4) Secured credit. If an applicant re quests secured credit, a creditor may re quire the signature of the applicant’s spouse or other person on any instrument neces sary, or reasonably believed by the creditor to be necessary, under applicable state law to make the property being offered as secu rity available to satisfy the debt in the event of default, for example, an instrument to create a valid lien, pass clear title, waive inchoate rights, or assign earnings. (5) Additional parties. If, under a credi tor’s standards of creditworthiness, the per sonal liability of an additional party is nec essary to support the extension of the credit requested, a creditor may request a cosign er, guarantor, or the like. The applicant’s spouse may serve as an additional party, but the creditor shall not require that the spouse be the additional party. (6) Rights o f additional parties. A creditor shall not impose requirements upon an ad ditional party that the creditor is prohibited from imposing upon an applicant under this section. (e) Insurance. A creditor shall not refuse to extend credit and shall not terminate an ac count because credit life, health, accident, dis ability, or other credit-related insurance is not available on the basis of the applicant’s age. SECTION 202.8—Special-Purpose Credit Programs (a) Standards fo r programs. Subject to the § 202.9 Regulation B provisions of paragraph (b) of this section, the act and this regulation permit a creditor to extend special-purpose credit to applicants who meet eligibility requirements under the following types of credit programs: (1) any credit assistance program express ly authorized by federal or state law for the benefit of an economically disadvantaged class of persons; (2) any credit assistance program offered by a not-for-profit organization, as defined under section 501(c) of the Internal Reve nue Code of 1954, as amended, for the ben efit of its members or for the benefit of an economically disadvantaged class of per sons; or (3) any special-purpose credit program of fered by a for-profit organization or in which such an organization participates to meet special social needs, if— (i) the program is established and ad ministered pursuant to a written plan that identifies the class of persons that the program is designed to benefit and sets forth the procedures and standards for extending credit pursuant to the pro gram; and (ii) the program is established and ad ministered to extend credit to a class of persons who, under the organization’s customary standards of creditworthiness, probably would not receive such credit or would receive it on less favorable terms than are ordinarily available to other ap plicants applying to the organization for a similar type and amount of credit. (b) Rules in other sections. (1) General appli cability. All of the provisions of this regula tion apply to each of the special-purpose credit programs described in paragraph (a) of this section unless modified by this section. (2) Common characteristics. A program described in paragraph (a)(2 ) or (a )(3 ) of this section qualifies as a special-purpose credit program only if it was established and is administered so as not to discrimi nate against an applicant on any prohibited basis; however, all program participants may be required to share one or more com mon characteristics (for example, race, na tional origin, or sex) so long as the program was not established and is not administered with the purpose of evading the require ments of the act or this regulation. (c) Special rule concerning requests and use o f information. If participants in a special-pur pose credit program described in paragraph (a) of this section are required to possess one or more common characteristics (for exam ple, race, national origin, or sex) and if the program otherwise satisfies the requirements of paragraph (a), a creditor may request and consider information regarding the common characteristic(s) in determining the appli cant’s eligibility for the program. (d) Special rule in the case o f financial need. If financial need is one of the criteria under a special-purpose program described in para graph (a) of this section, the creditor may re quest and consider, in determining an appli cant’s eligibiltiy for the program, information regarding the applicant’s marital status; ali mony, child support, and separate mainte nance income; and the spouse’s financial re sources. In addition, a creditor may obtain the signature of an applicant’s spouse or other person on an application or credit instrument relating to a special-purpose program if the signature is required by federal or state law. SECTION 202.9— Notifications (a) Notification o f action taken, ECOA notice, and statement o f specific reasons. (1) When notification is required. A creditor shall no tify an applicant of action taken within— (i) 30 days after receiving a completed application concerning the creditor’s ap proval of, counteroffer to, or adverse ac tion on the application; (ii) 30 days after taking adverse action on an incomplete application, unless no tice is provided in accordance with para graph (c) of this section; (iii) 30 days after taking adverse action of an existing account; or (iv) 90 days after notifying the applicant of a counteroffer if the applicant does not expressly accept or use the credit offered. 9 § 202.9 (2) Content o f notification when adverse action is taken. A notification given to an applicant when adverse action is taken shall be in writing and shall contain: a statement of the action taken; the name and address of the creditor; a statement of the provisions of section 701(a) of the act; the name and address of the federal agency that adminis ters compliance with respect to the creditor; and either— (i) a statement of specific reasons for the action taken; or (ii) a disclosure of the applicant’s right to a statement of specific reasons within 30 days, if the statement is requested within 60 days of the creditor’s notifica tion. The disclosure shall include the name, address, and telephone number of the person or office from which the state ment of reasons can be obtained. If the creditor chooses to provide the reasons orally, the creditor shall also disclose the applicant’s right to have them confirmed in writing within 30 days of receiving a written request for confirmation from the applicant. (3) Notification to business credit appli cants. For business credit, a creditor shall comply with the requirements of this para graph in the following manner: (i) With regard to a business that had gross revenues of $1,000,000 or less in its preceding fiscal year (other than an ex tension of trade credit, credit incident to a factoring agreement, or other similar types of business credit), a creditor shall comply with paragraphs (a )(1 ) and (2), except that— (A ) The statement of the action taken may be given orally or in writing, when adverse action is taken; (B) Disclosure of an applicant’s right to a statement of reasons may be given at the time of application, instead of when adverse action is taken, provided the disclosure is in a form the appli cant may retain and contains the infor mation required by paragraph (a) (2) (ii) and the ECOA notice spec ified in paragraph (b)(1 ) of this section; (C) For an application made solely by Regulation B telephone, a creditor satisfies the re quirements of this paragraph by an oral statement of the action taken and of the applicant’s right to a statement of reasons for adverse action. (ii) With regard to a business that had gross revenues in excess of $1,000,000 in its preceding fiscal year or an extension of trade credit, credit incident to a factor ing agreement, or other similar types of business credit, a creditor shall— (A ) Notify the applicant, orally or in writing, within a reasonable time of the action taken; and (B) Provide a written statement of the reasons for adverse action and the ECOA notice specified in paragraph (b )(1 ) of this section if the applicant makes a written request for the reasons within 60 days of being notified of the adverse action. (b) Form o f ECOA notice and statement o f specific reasons. (1) ECOA notice. To satisfy the disclosure requirements of paragraph (a )(2 ) of this section regarding section 701(a) of the act, the creditor shall provide a notice that is substantially similar to the following: The federal Equal Credit Opportunity Act pro hibits creditors from discriminating against cred it applicants on the basis of race, color, religion, national origin, sex, marital status, age (provided the applicant has the capacity to enter into a binding contract); because all or part of the ap plicant’s income derives from any public assist ance program; or because the applicant has in good faith exercised any right under the Con sumer Credit Protection Act. The federal agency that administers compliance with this law con cerning this creditor is (name and address as specified by the appropriate agency listed in ap pendix A of this regulation). (2) Statement o f specific reasons. The state ment of reasons for adverse action required by paragraph (a) (2) (i) of this section must be specific and indicate the principal reason(s) for the adverse action. State ments that the adverse action was based on the creditor’s internal standards or policies or that the applicant failed to achieve the qualifying score on the creditor’s credit scoring system are insufficient. Regulation B (c) Incomplete applications. (1) Notice alter natives. Within 30 days after receiving an application that is incomplete regarding matters that an applicant can complete, the creditor shall notify the applicant either— (i) of action taken, in accordance with paragraph (a) of this section; or (ii) of the incompleteness, in accordance with paragraph (c) (2) of this section. (2) Notice o f incompleteness. If additional information is needed from an applicant, the creditor shall send a written notice to the applicant specifying the information needed, designating a reasonable period of time for the applicant to provide the infor mation, and informing the applicant that failure to provide the information requested will result in no further consideration being given to the application. The creditor shall have no further obligation under this sec tion if the applicant fails to respond within the designated time period. If the applicant supplies the requested information within the designated time period, the creditor shall take action on the application and no tify the applicant in accordance with para graph (a) of this section. (3) Oral request fo r information. At its op tion, a creditor may inform the applicant orally of the need for additional informa tion; but if the application remains incom plete the creditor shall send a notice in ac cordance with paragraph (c)(1 ) of this section. (d) Oral notifications by small-volume credi tors. The requirements of this section (includ ing statements of specific reasons) are satisfied by oral notifications in the case of any creditor that did not receive more than 150 applica tions during the preceding calendar year. (e) Withdrawal o f approved application. When an applicant submits an application and the parties contemplate that the applicant will inquire about its status, if the creditor ap proves the application and the applicant has not inquired within 30 days after applying, the creditor may treat the application as with drawn and need not comply with paragraph (a )(1 ) of this section. (f) Multiple applicants. When an application § 202.10 involves more than one applicant, notification need only be given to one of them but must be given to the primary applicant where one is readily apparent. (g) Applications submitted through a third party. When an application is made on behalf of an applicant to more than one creditor and the applicant expressly accepts or uses credit offered by one of the creditors, notification of action taken by any of the other creditors is not required. If no credit is offered or if the applicant does not expressly accept or use any credit offered, each creditor taking adverse ac tion must comply with this section, directly or through a third party. A notice given by a third party shall disclose the identity of each creditor on whose behalf the notice is given. SECTION 202.10— Furnishing of Credit Information (a) Designation o f accounts. A creditor that furnishes credit information shall designate— (1) any new account to reflect the partici pation of both spouses if the applicant’s spouse is permitted to use or is contractual ly liable on the account (other than as a guarantor, surety, endorser, or similar par ty); and (2) any existing account to reflect such participation, within 90 days after receiving a written request to do so from one of the spouses. (b) Routine reports to consumer reporting agency. If a creditor furnishes credit informa tion to a consumer reporting agency concern ing an account designated to reflect the partic ipation of both spouses, the creditor shall furnish the information in a manner that will enable the agency to provide access to the in formation in the name of each spouse. (c) Reporting in response to inquiry. If a cred itor furnishes credit information in response to an inquiry concerning an account designat ed to reflect the participation of both spouses, the creditor shall furnish the information in the name of the spouse about whom the infor mation is requested. 11 § 202.11 SECTION 202.11—Relation to State Law (a) Inconsistent state laws. Except as other wise provided in this section, this regulation alters, affects, or preempts only those state laws that are inconsistent with the act and this regulation and then only to the extent of the inconsistency. A state law is not inconsistent if it is more protective of an applicant. (b) Preempted provisions o f state law. (1) A state law is deemed to be inconsistent with the requirements of the act and this regula tion and less protective of an applicant within the meaning of section 705(f) of the act to the extent that the law— (i) requires or permits a practice or act prohibited by the act or this regulation; (ii) prohibits the individual extension of consumer credit to both parties to a mar riage if each spouse individually and vol untarily applies for such credit; (iii) prohibits inquiries or collection of data required to comply with the act or this regulation; (iv) prohibits asking or considering age in an empirically derived, demonstrably and statistically sound, credit scoring sys tem to determine a pertinent element of creditworthiness, or to favor an elderly applicant; or (v) prohibits inquiries necessary to es tablish or administer a special-purpose credit program as defined by section 202.8. (2) A creditor, state, or other interested party may request the Board to determine whether a state law is inconsistent with the requirements of the act and this regulation. (c) Laws on finance charges, loan ceilings. If married applicants voluntarily apply for and obtain individual accounts with the same creditor, the accounts shall not be aggregated or otherwise combined for purposes of deter mining permissible finance charges or loan ceilings under any federal or state law. Per missible loan ceiling laws shall be construed to permit each spouse to become individually lia ble up to the amount of the loan ceilings, less the amount for which the applicant is jointly liable. 12 Regulation B (d) State and federal laws not affected. This section does not alter or annul any provision of state property laws, laws relating to the dis position of decedents’ estates, or federal or state banking regulations directed only toward insuring the solvency of financial institutions. (e) Exemption fo r state-regulated transac tions. (1) Applications. A state may apply to the Board for an exemption from the re quirements of the act and this regulation for any class of credit transactions within the state. The Board will grant such an exemp tion if the Board determines that— (i) the class of credit transactions is sub ject to state law requirements substantial ly similar to the act and this regulation or that applicants are afforded greater pro tection under state law; and (ii) there is adequate provision for state enforcement. (2) Liability and enforcement, (i) No ex emption will extend to the civil-liability provisions of section 706 or the administrative-enforcement provisions of section 704 of the act. (ii) After an exemption has been grant ed, the requirements of the applicable state law (except for additional require ments not imposed by federal law) will constitute the requirements of the act and this regulation. SECTION 202.12 — Record Retention (a) Retention o f prohibited information. A creditor may retain in its files information that is prohibited by the act or this regulation in evaluating applications, without violating the act or this regulation, if the information was obtained—(1) from any source prior to March 23, 1977; (2) from consumer reporting agencies, an applicant, or others without the specific re quest of the creditor; or (3) As required to monitor compliance with the act and this regulation or other federal or state statutes or regulations. (b) Preservation o f records. (1) Applications. Regulation B For 25 months (12 months for business credit) after the date that a creditor notifies an applicant of action taken on an applica tion or of incompleteness, the creditor shall retain in original form or a copy thereof— (i) any application that it receives, any information required to be obtained con cerning characteristics of the applicant to monitor compliance with the act and this regulation or other similar law, and any other written or recorded information used in evaluating the application and not returned to the applicant at the appli cant’s request; (ii) a copy of the following documents if furnished to the applicant in written form (or, if furnished orally, any notation or memorandum made by the creditor): (A ) the notification of action taken; and (B) the statement of specific reasons for adverse action; and (iii) any written statement submitted by the applicant alleging a violation of the act or this regulation. (2) Existing accounts. For 25 months (12 months Tor business credit) after the date that a creditor notifies an applicant of ad verse action regarding an existing account, the creditor shall retain as to that account, in original form or a copy thereof— (i) any written or recorded information concerning the adverse action; and (ii) any written statement submitted by the applicant alleging a violation of the act or this regulation. (3) Other applications. For 25 months (12 months for business credit) after the date that a creditor receives an application for which the creditor is not required to com ply with the notification requirements of section 202.9, the creditor shall retain all written or recorded information in its pos session concerning the applicant, including any notation of action taken. (4) Enforcement proceedings and investiga tions. A creditor shall retain the informa tion specified in this section beyond 25 months (12 months for business credit) if it has actual notice that it is under investiga tion or is subject to an enforcement pro ceeding for an alleged violation of the act or §202.13 this regulation by the attorney general of the United States or by an enforcement agency charged with monitoring that credi tor’s compliance with the act and this regu lation, or if it has been served with notice of an action filed pursuant to section 706 of the act and section 202.14 of this regula tion. The creditor shall retain the informa tion until final disposition of the matter, un less an earlier time is allowed by order of the agency or court. (5) Special rule fo r certain business-credit applications. With regard to a business with gross revenues in excess of $1,000,000 in its preceding fiscal year, or an extension of trade credit, credit incident to a factoring agreement or other similar types of business credit, the creditor shall retain records for at least 60 days after notifying the applicant of the action taken. If within that time peri od the applicant requests in writing the rea sons for adverse action or that records be retained, the creditor shall retain records for 12 months. SECTION 202.13— Information for Monitoring Purposes (a) Information to be requested. A creditor that receives an application for credit primari ly for the purchase or refinancing of a dwelling occupied or to be occupied by the applicant as a principal residence, where the extension of credit will be secured by the dwelling, shall request as part of the applica tion the following information regarding the applicant (s): (1) race or national origin, using the cate gories American Indian or Alaskan Native; Asian or Pacific Islander; Black; White; Hispanic; Other (Specify); (2) sex; (3) marital status, using the categories Married, Unmarried, and Separated; and (4) age. “Dwelling” means a residential structure that contains one to four units, whether or not that structure is attached to real property. The term includes, but is not limited to, an indi vidual condominium or cooperative unit, and a mobile or other manufactured home. 13 §202.13 (b) Obtaining o f information. Questions re garding race or national origin, sex, marital status, and age may be listed, at the creditor’s option, on the application form or on a sepa rate form that refers to the application. The applicant (s) shall be asked but not required to supply the requested information. If the ap p lican ts) chooses not to provide the informa tion or any part of it, that fact shall be noted on the form. The creditor shall then also note on the form, to the extent possible, the race or national origin and sex of the applicant(s) on the basis of visual observation or surname. (c) Disclosure to applicant(s). The creditor shall inform the applicant (s) that the infor mation regarding race or national origin, sex, marital status, and age is being requested by the federal government for the purpose of monitoring compliance with federal statutes that prohibit creditors from discriminating against applicants on those bases. The creditor shall also inform the applicant (s) that if the applicant (s) chooses not to provide the infor mation, the creditor is required to note the race or national origin and sex on the basis of visual observation or surname. (d) Substitute monitoring program. A moni toring program required by an agency charged with administrative enforcement un der section 704 of the act may be substituted for the requirements contained in paragraphs (a), (b), and (c). SECTION 202.14— Enforcement, Penalties, and Liabilities (a) Administrative enforcement. (1) As set forth more fully in section 704 of the act, administrative enforcement of the act and this regulation regarding certain creditors is assigned to the Comptroller of the Curren cy, Board of Governors of the Federal Re serve System, board of directors of the Fed eral Deposit Insurance Corporation, Office of Thrift Supervision, National Credit Un ion Administration, Interstate Commerce Commission, secretary of agriculture, Farm Credit Administration, Securities and Ex change Commission, Small Business 14 Regulation B Administration, and secretary of transportation. (2) Except to the extent that administra tive enforcement is specifically assigned to other authorities, compliance with the re quirements imposed under the act and this regulation is enforced by the Federal Trade Commission. (b) Penalties and liabilities. (1) Sections 706(a) and (b) and 702(g) of the act pro vide that any creditor that fails to comply with a requirement imposed by the act or this regulation is subject to civil liability for actual and punitive damages in individual or class actions. Pursuant to sections 704(b), (c), and (d) and 702(g) of the act, violations of the act or regulation also con stitute violations of other federal laws. Lia bility for punitive damages is restricted to nongovernmental entities and is limited to $10,000 in individual actions and the lesser of $500,000 or 1 percent of the creditor’s net worth in class actions. Section 706(c) provides for equitable and declaratory relief and section 706(d) authorizes the awarding of costs and reasonable attorney’s fees to an aggrieved applicant in a successful action. (2) As provided in section 706(f), a civil action under the act or this regulation may be brought in the appropriate United States district court without regard to the amount in controversy or in any other court of com petent jurisdiction within two years after the date of the occurrence of the violation, or within one year after the commencement of an administrative enforcement proceed ing or of a civil action brought by the attor ney general of the United States within two years after the alleged violation. (3) Sections 706(g) and (h) provide that, if an agency responsible for administrative enforcement is unable to obtain compliance with the act or this regulation, it may refer the matter to the attorney general of the United States. On referral, or whenever the Attorney General has reason to believe that one or more creditors are engaged in a pat tern or practice in violation of the act or this regulation, the attorney general may bring a civil action. (c) Failure o f compliance. A creditor’s failure Appendix B Regulation B to comply with sections 202.6(b)(6), 202.9, 202.10, 202.12 or 202.13 is not a violation if it results from an inadvertent error. On discov ering an error under sections 202.9 and 202.10, the creditor shall correct it as soon as possible. If a creditor inadvertently obtains the monitoring information regarding the race or national origin and sex of the applicant in a dwelling-related transaction not covered by section 202.13, the creditor may act on and retain the application without violating the regulation. APPENDIX A—Federal Enforcement Agencies The following list indicates the federal agen cies that enforce Regulation B for particular classes of creditors. Any questions concerning a particular creditor should be directed to its enforcement agency. National Banks Comptroller of the Currency Consumer Examinations Division Washington, D.C. 20219 State Member Banks Federal Reserve Bank serving the District in which the state member bank is located. Nonmember Insured Banks Federal Deposit Insurance Corporation Re gional Director for the region in which the nonmember insured bank is located. Savings institutions under the Savings Association Insurance Fund o f the FDIC and federally chartered savings banks insured under the Bank Insurance Fund o f the FDIC (but not including state-chartered savings banks insured under the Bank Insurance Fund) The district director of the Office of Thrift Su pervision in the district in which the institu tion is located. Federal Credit Unions Regional office of the National Credit Union Administration serving the area in which the federal credit union is located. Air Carriers Assistant General Counsel for Aviation En forcement and Proceedings Department of Transportation 400 Seventh Street, S.W. Washington, D.C. 20590 Creditors Subject to Interstate Commerce Commission Office of Proceedings Interstate Commerce Commission Washington, D.C. 20523 Creditors Subject to Packers and Stockyards Act Nearest Packers and Stockyards Administra tion area supervisor. Sm all Business Investment Companies U.S. Small Business Administration 1441 L Street, N.W. Washington, D.C. 20416 Brokers and Dealers Securities and Exchange Commission Washington, D.C. 20549 Federal Land Banks, Federal Land Bank Associations, Federal Intermediate Credit Banks, and Production Credit Associations Farm Credit Administration 1501 Farm Credit Drive McLean, Virginia 22102-5090 Retailers, Finance Companies, and A ll Other Creditors Not Listed Above FTC regional office for region in which the creditor operates or Federal Trade Commission Equal Credit Opportunity Washington, D.C. 20580 APPENDIX B— Model Application Forms This appendix contains five model credit ap plication forms, each designed for use in a particular type of consumer credit transaction as indicated by the bracketed caption on each form. The first sample form is intended for use in open-end, unsecured transactions; the sec15 Appendix B ond for closed-end, secured transactions; the third for closed-end transactions, whether unsecured or secured; the fourth in transac tions involving community property or occur ring in community property states; and the fifth in residential mortgage transactions. The appendix also contains a model disclosure for use in complying with section 202.13 for cer tain dwelling-related loans. All forms con tained in this appendix are models; their use by creditors is optional. The use or modification of these forms is governed by the following instructions. A creditor may change the forms by asking for additional information not prohibited by sec tion 202.5; by deleting any information re quest; or by rearranging the format without modifying the substance of the inquiries. In any of these three instances, however, the ap propriate notices regarding the optional na ture of courtesy titles; the option to disclose alimony, child support, or separate mainte nance; and the limitation concerning marital status inquiries must be included in the appro priate places if the items to which they relate appear on the creditor’s form. If a creditor uses an appropriate appendix B model form, or modifies a form in accordance with the above instructions, that creditor shall be deemed to be acting in compliance with the provisions of paragraphs (c) and (d) of sec tion 202.5 of this regulation. Regulation B Appendix B Regulation B [Open-end, unsecured credit] CREDIT APPLICATION IMPORTANT: Read these Directions before completing this Application. Check A ppropriate Box □ If you are applying fo r an individual account in your own name and are relying on your own income or assets and not the income o r assets of another person as the basis for repayment o f the credit requested, com plete only Sections A and D. □ If you are applying fo r a joint account o r an account th at you and another person will use, complete all Sections, providing inform ation in B about the joint applicant or user. □ If you are applying for an individual account, but a re relying on income from alimony, child support, or separate maintenance or on the incomc o r assets of a nother person as the basis for repaym ent of the credit requested, complete ail Sections to the extent possible, providing in form ation in B about the person on whose alimony, support, o r maintenance payments or income o r assets you are relying. SECTION A—IN FO R M A T IO N R E G A R D IN G A P PL IC A N T Full N ame (Last, F irst, M id d le ): ...................................................... B irthdate: Present Street A ddress: Y ears there: .......................................................................... / C ity: Previous Street Address: C ity: .. ............................................... Present Em ployer: Position o r title: .................................................... .......................................... Employer’s A ddress: Previous Em ployer's A ddress: Present net salary o r commission: $ per . No. D ependents: Ages: Alimony, child support, or separate maintenance income need not be revealed if you do not wish to have it considered as a basis for repaying this obligation. Alimony, child support, separate maintenance received under: co u rt order □ written agreement □ oral understanding □ O ther income: $ per S ource(s) o f other income: Is any income listed in this Section likely to be reduced in the next two years? □ Yes (Explain in detail on a separate sheet.) N o □ Have you ever received credit from us? W hen? Office: N am e o f nearest relative Relationship: Address: SECTION B—IN FO RM A T IO N R E G A R D IN G JO IN T A PP L IC A N T , USER, O R O TH ER PA RTY (U se separate sheets if necessary.) City: Present net salary or commission: $ per . No. D ependents: Alimony, child support, separate maintenance received under: co u rt order □ O ther income: $ Ages: w ritten agreement □ oral understanding □ . S ource(s) o f other income: Is any income listed in this Section likely to be reduced in the next two years? □ Yes (E xplain in detail on a separate sheet.) □ N o Checking A ccount N o .: ................................. ...... Institution and Branch: Savings A ccount N o.: Institution and Branch: ........................... . . . . . . N am e o f nearest relative not living with Join t Applicant, User, or O ther Party: . Relationship: ............................................................. Address: SECTIO N C—M A RITA L STATUS (D o not complete if this is an application for an individual account.) A pplicant: □ M arried □ Separated □ Unm arried (including single, divorced, and widowed) O ther Party: □ M arried □ Separated □ U nm arried (including single, divorced, and widowed) 17 Regulation B Appendix B SEC TIO N D — A SSET A N D D E B T IN FO R M A T IO N ( I f Section B h as been com pleted, this Section should be completed giving inform ation about both the A pplicant and Jo in t A pplicant, User, o r O th er Person. Please m ark Applicant-related in form ation w ith a n "A .” If Section B was n o t com pleted, only give inform ation abo u t the A pplicant in this Section.) A S S E T S O W N E D (U se separate sheet if necessary.) Description of Assets Value Cash Subject to Debt? Y es/N o N am e(s) o f O w ner(s) $ Autom obiles (M ake, Model, Y ear) C ash Value of Life Insurance (Issuer, Face V alue) R eal E state (Location, D ate A cquired) M arketable Securities (Issuer, Type, N o. o f Shares) O ther (List) T otal Assets $ O U T S T A N D IN G D E B T S (Include charge accounts, instalment contracts, credit cards, rent, m ortgages, etc. Use separate sheet if necessary.) Type o f Debt o r Acct. No. Creditor 1. (Landlord or Mortgage H older) □ □ Nam e in Which Acct. C arried Rent Payment Mortgage O riginal Present M onthly D ebt Payments Balance $ (O m it rent) $ (O m it rent) $ Past Due ? Y es/N o i. 3. 4. i. 6. $ $ S T otal D ebts (Credit References) D ate Paid r s T A re you a co-m aker, endorser, o r If “yes” g uarantor on any loan o r contract? Y es □ No □ fo r w hom?_________________________ T o whom?_____________ A re there any unsatisfied Yes □ If “yes” judgm ents against you?______________ N o □ ______ A m ount S_______________________ to whom owed?________________________ Have you been declared Yes □ If “ yes” Y ear bankrupt in the last 14 years?_______ N o [ j _______ where?______ O ther Obligations— (E.g., liability to pay alimony, child support, separate m aintenance. Use separate sheet if necessary.) Everything th at I have stated in this application is correct to the best o f my knowledge. I understand th at you will retain this application whether o r not it is approved. Y ou are authorized to check my credit and em ploym ent history and to answer ques tions about your credit experience w ith me. A pplicant’s Signature 18 D ue O ther Signature (W here Applicable) D ate Appendix B Regulation B [Closed-end, secured credit] CREDIT APPLICATION IM PORTANT: Read these Directions before comp If ting this Application. Check A ppropriate A m ount Requested If you are applying for individual credit in your own nam e and are relying on your own income o r assets an d not the income o r assets of another person as the basis for repayment o f the credit requested, complete Sections A , C, D, and E, om itting B and the second p art o f C. If this is a n application for joint credit with another person, complete all Sections, providing inform ation in B about the joint applicant. If you are applying for individual credit, b ut are relying on income from alimony, child support, o r sepa rate maintenance o r on the income o r assets o f another person as the basis for repayment of the credit requested, com plete all Sections to the extent possible, providing inform ation in B about the person on whose alimony, support, or m aintenance payments or income o r assets you are relying. P aym ent D ate Desired Proceeds o f Credit SE C T IO N A—IN FO R M A T IO N R E G A R D IN G A P PL IC A N T / ............ Present net salary o r com mission: $ per . N o. D ependents: Ages: Alimony, child support, or separate msintenan ce income need not be revealed If yon do not wish to have H considered as a basis for repaying this obligation. Alimony, child support, separate maintenance received under: court order □ w ritten agreement □ oral understanding □ I s any income listed in this Section likely to be reduced before the credit requested is paid off? □ Yes (Explain in detail on a separate sheet.) N o □ SEC TIO N B—IN FO R M A T IO N R E G A R D IN G JO IN T A P P L IC A N T O R O T H E R PA RTY (U se separate sheets if necessary.) p er . No. D ependents: Ages: Present net salary or com mission: $ Alimony, child support, or separate maintenance income need not be revealed if yon do not wish to have it considered as a basis for repaying this obligation. Alimony, child support, separate maintenance received under: court order D w ritten agreement □ oral understanding □ Is any income listed in this Section likely to be reduced before the credit requested is paid off? □ Yes (Explain in detail on a separate sheet.) N o □ Savings Account N o.: ........................................ Institution and Branch: Relationship: ............................................................................ SECTIO N C—M ARITAL STATUS Applicant: □ Married □ Separated O ther Party: □ M arried □ Separated □ U nm arried □ (including single, divorced, and widowed) U nm arried (including single, divorced, and widowed) 19 Appendix B Regulation B SEC TIO N D — A SSET A N D D EB T IN FO RM A TIO N ( If Section B has been completed, this Section should be completed giving information about both the Applicant and Joini Applicant o r O ther Person. Please mark Anplicant-related inform a tion with an " A .” If Section B was not completed, only give inform ation about the Applicant in this Section.) A S S E T S O W N E D (U se separate sheet if necessary.) Description o f Assets Value Cash Subject to Debt? Y es/N o Name(s) o f Owner(s) $ A utomobiles (M ake, M odel, Y ear) Cash Value o f Life Insurance (Issuer, F ace Value) Real E state (Location, D ate A cquired) M arketable Securities (Issuer, Type, No. o f Shares) O ther (List) T otal Assets $ Use separate sheet if C reditor 1. (L andlord or M ortgage H older) Type o f Debt o r Acct. No. □ □ N am e in Which Acct. Carried Rent Payment Mortgage Original Debt Present Balance M onthly Payments Past Due? Yes No $ (O m it rent) $ (O m it rent) $ 2. 3. S $ $ Total Debts (Credit References) Yes □ No □ Other obligations— (E.g., liability to pay alimony, child support, separate maintenance. Use separate sheet if necessary.) SEC TIO N E—SEC U RED C R E D IT Briefly describe the property to be given as security: and list nam es and addresses of all co-owners o f the property: Name If the security is real estate, give the full nam e o f your spouse (if any): Everything that 1 have stated in this application is correct to the best o f my knowledge. I understand that you will retain this application whether or not it is approved. You are authorized to check my credit and employment history and to answer ques tions about youi credit experience with me. A pplicant’s Signature 20 O ther Signature (W here Applicable) Appendix B Regulation B [Closed-end, unsecured/secured credit] CREDIT APPLICATION IMPORTANT: Read these Directions before completing this Application. □ If you are applying for individual credit in your own nam e and are relying on your own income o r assets an d not the income o r assets o f a nother person a s the basis for repayment o f the credit requested, com plete only Sections A and D. If the requested credit is to be secured, also com plete the first p art of Section C and Section E. □ If you are applying for joint credit w ith another person, complete all Sections except E , providing inform a tion in B about the joint applicant. If the requested credit is to be secured, then complete Section E. If you a re applying for individual credit, but are relying on income from alimony, child support, o r sepa rate maintenance o r on the income o r assets o f a n o th er person as the basis for repayment o f the credit requested, com plete all Sections except E to the extent possible, providing inform ation in B about the person on whose alimony, support, o r m aintenance paym ents o r income o r assets you are relying. If the requested credit is to be secured, then com plete Section E. □ A m ount Requested Paym ent D a te Desired Proceeds of Credit SE C T IO N A—IN F O R M A T IO N R E G A R D IN G A P PL IC A N T Zip- Present net salary o r com mission: $ per . No. D ependents: Ages: basis to r repaying this obligation. Alimony, child support, separate maintenance received under: co u rt order □ O th er income* $ w ritten agreement □ oral understanding □ per Is any income listed in this Section likely to be reduced before th e credit requested is paid off? □ □ Yes (E xplain in detail on separate sheet.) No N am e o f nearest relative SE C T IO N B—IN FO R M A T IO N R E G A R D IN G JO IN T A P P L IC A N T O R O T H E R PA R T Y (U se separate sheets if necessary.) • A lt Present net salary o r commission: $....................... per ........ in ..... No. Dependents .................... Ages: ................. aot be revealed If yo« do not wish to have it considered as a Alimony, child support, separate maintenance received under:: co u rt order □ w ritten agreement □ oral understanding □ Is any income listed in th is Section likely to be reduced before the credit requested is paid off? □ Yes (E xplain in detail on separate sheet.) Savings A ccount N o .: .............................................. □ No ....... Institution and Branch: 21 Appendix B Regulation B SEC TIO N C—M A R ITA L STATUS (Do not complete if this is an application for individual unsecured credit.) Appiicant □ M arried □ Separated □ Unm arried (including single, divorced, and widowed) O ther P arty: □ Married □ Separated □ U nm arried (including single, divorced, and widowed) SECTIO N D— A SSET A N D D EB T IN FO R M A TIO N (If Section B has been completed, this Section should be completed giving information about both the Applicant and Joint Applicant or O ther Person. Please m ark A pplicant-related information with an "A .” If Section B was not com pleted, only give information about the Applicant in this Section.) D escription of Assets Value Cash Subject to Debt? Y es/N o Name(s) o f Owner(s) $ A utom obiles (M ake, M odel, Year) Cash Value o f Life Insurance (Issuer, F ace V alue) R eal E state (Location, D ate A cquired) M arketable Securities (Issuer. Type. No. o f Shares) O ther (List) T otal Assets $ O U T S T A N D IN G D E B T S (Include charge accounts, instalment contracts, credit cards, necessary.) Creditor 1. (L andlord or Mortgage Holder) Type of Debt o r Acct. No. □ Rent Payment □ Mortgage N am e in Which Acct. C arried mortgages, etc. Use separate sheet if Original Debt Monthly Payments Present Balance $ (Omit rent) $ (Omit rent) $ 3................. $ $ Past Due? Yes No 2. T otal Debts Are you a co-maker, endorser, o r guarantor on any loan o r contract? Y es □ No □ If "Y es,” for whom? Have you been declared bankrupt in the last 14 years'1 Y ear O ther obligations— (E.g., liability to pay alimony, child support, separate m aintenance. Use separate sheet if necessary.) SEC TIO N E— SE C U RE D C R E D IT (Complete only if credit is to be secured.) Briefly describe the property to be given as security: a nd list names and addresses of all co-owners o f the property: N am e If the security is real estate, give the full nam e o f your spouse (if a n y ): Everything that I have stated in this application is correct to the best of my knowledge. I understand that you will retain this application whether or not it is approved. You are authorized to check my credit and employment history and to answer ques tions about your credit experience w ith me. A pplicant's Signature 22 Appendix B Regulation B [Community property] CREDIT APPLICATION IMPORTANT: Read these Directions before completing this Application. Check A ppropriate Box □ !f you are applying fo r individual credit in your own nam e, are not m arried, a n d are not relying on alimony. child support, o r separate maintenance payments o r o n the incom e o r assets o f a nother person a s the basis fo r repaym ent o f the credit requested, com plete only Sections A and D. If the requested credit is to be secured, also com plete Section E. □ In all oth er situations, complete all Sections except E , providing inform ation in B about your spouse, a joint applicant o r user, o r the person on whose alimony, support, o r maintenance payments or income or assets you are relying. If the requested credit is to be secured, also complete Section E. A m ount Requested Paym ent D a te Desired Proceeds of C redit T o be U sed Fo r SE C T IO N A— IN FO R M A T IO N R E G A R D IN G A PP L IC A N T . B irthdate: F ull N am e (L ast, First, M id d le): ......................................................... .............Zip: ........................ City: ............................................................................ State: / Years there: Present Street Address ................................................................................ / ............ Telephone: Driver’s License N o.: Social Security N o .: ............................................................... Previous Street A ddress: .................................................... C ity: ....................... ........................... ...................... State: Zip: Years there: Present Em ployer: ................................................................. Position o r title: ................................................................... ............... .. Nam e o f supervisor: Em ployer’s A ddress: ..................... ....................................... Previous Em ployer: ................................... Previous Employer’s A ddress: .......... . N o. D ependents: Present net salary o r com m ission: S Ages: a c t income need not be revealed if yon do not wish to have it considered as a basis A lim ony, child support, separate maintenance received u nder: court ord e r □ w ritten agreement □ O th er income: $ ................................. p e r .................................. S ource(s) of oth er incom e: o ral understanding □ .................. Is any income listed in this Section likely to be reduced in the next tw o years o r before the credit requested is p aid off? □ Yes (E xplain in detail on a separate sheet.) N o □ H ave you ever received credit from us? ........................... W hen? . ................... Office: Checking Account N o .: ............................................................................. Institution and B ranch: Savings Account N o .: ................................................................................. . Institution and Branch: N am e o f nearest relative n o t living with you .................................. R elationship: ................................................................................................ S E C T IO N B— IN F O R M A T IO N R E G A R D IN G SPO U SE. JO IN T A PP L IC A N T , U SE R , O R O T H E R P A R T Y (U se separate sheets if necessary.) F ull N am e (L ast, First, M id d le ): . B irthdate: R elationship to A pplicant (if any): . Y ears there: / / ............ Present Street A ddress: ....................... ................................... S tate: ............. ................................ Zip: ......... C ity: ................................... ........................ Social Security N o .: ..... ................................... ................................ .................... ............. ........... .............................................. Present Em ployer: .............................. . D river’s License N o .: Y ears there: ................ Position o r title: ...................................................................................................N ame o f supervisor: Em ployer's Address: .......................................................................................... - ........................................ Previous Em ployer: ..................................................................................................................................... - ... Previous Employer’s A ddress: ........... Present net salary or commission: $ . No. Dependents: re income need not be revealed if yon do not wish to have it considered as a 1 Alim ony, child support, separate maintenance received under: court order □ O ther income: w ritten agreement □ oral understanding □ . Source(s) of other income: Is any income listed in this Section likely to be reduced in th e next two years o r before the credit requested is paid off? □ Yes (Explain in detail on a separate sheet.) □ N o Checking Account N o .: ............ ....................................................................... Institution and Branch: ........................................................ •••—......... Savings A ccount N o .: . Institution and Branch: 23 Appendix B Regulation B SECTION C—M A R ITA L STATUS A pplicant: □ O ther Party: □ M arried M arried □ □ Separated Separated □ U nm arried (including single, divorced, and widowed) □ U nm arried (including single, divorced, widowed) SECTION D —A SSET A N D D E B T IN FO R M A T IO N (If Section B has been completed, this Section should be completed giving information about both the Applicant and Spouse, Jo in t Applicant, User, o r O ther Person. Please m ark Applicantrelated inform ation with a n “A .” If Section B was not completed, only give in form ation about the Applicant in this Section.) ASSENTS O W N E D (U«e separate sheet if necessary.) N am e of Creditor 1. (L andlord or M ortgage H older) T ype o f D ebt o r Acct. No. □ □ N am e in Which Acct. C arried Rent Payment Mortgage Present Balance O riginal Debt $ (O mit rent) $ (Omit rent) Monthly Payments Past Due? Y es/N o $ 2. 3. T o tal D ebts 1 ............... L§ “ nr-. (Credit References) A re you a co-maker, endorser, o r guarantor o n any loan o r contract? No □ Have you been declared bankrupt in the last 14 years O th er obligations— (E .g., Liability to pay alimony, child support, sepaiato m aintenance. U se separate sheet if necessary.) SECTION E— SE C U R E D C R E D IT (Complete only if credit is to be secured.) Briefly describe the property to be given as security: and list nam es an d addresses o f all co-owners o f the property: N am e Everything th at I have stated in this application is correct to the best o f m y knowledge. I understand that you will retain this application whether o r not it is approved. You are authorized to check my credit and em ploym ent history and to answ er ques tions about your credit experience with me. A pplicant’s Signature 24 O ther Signature (W here Applicable) Regulation B Appendix B [Residential real estate mortgage loan] RESIDENTIAL LOAN APPLICATION 25 Appendix B 26 Regulation B Appendix C Regulation B APPENDIX C—Sample Notification Forms This appendix contains eight sample notifica tion forms. Forms C-1 through C-4 are in tended for use in notifying an applicant that adverse action has been taken on an applica tion or account under section 202.9(a)(1) and (2 )(i) of this regulation. Form C-5 is a notice of disclosure of the right to request spe cific reasons for adverse action under section 202.9(a)(1) and ( 2 ) (ii). Form C-6 is de signed for use in notifying an applicant, under section 202.9(c)(2), that an application is incomplete. Forms C-1 and C-8 are intended for use in connection with applications for business credit under section 202.9(a)(3). Form C-1 contains the Fair Credit Report ing Act disclosure as required by sections 615(a) and (b) of that act. Forms C-2 through C-5 contain only the section 615(a) disclosure (that a creditor obtained informa tion from a consumer reporting agency that played a part in the credit decision). A credi tor must provide the section 615(b) disclo sure (that a creditor obtained information from an outside source other than a consumer reporting agency that played a part in the credit decision) where appropriate. The sample forms are illustrative and may not be appropriate for all creditors. They were designed to include some of the factors that creditors most commonly consider. If a credi tor chooses to use the checklist of reasons pro vided in one of the sample forms in this ap pendix and if reasons commonly used by the creditor are not provided on the form, the creditor should modify the checklist by substi tuting or adding other reasons. For example, if “inadequate downpayment” or “no deposit relationship with us” are common reasons for taking adverse action on an application, the creditor ought to add or substitute such rea sons for those presently contained on the sam ple forms. If the reasons listed on the forms are not the factors actually used, a creditor will not satisfy the notice requirement by simply checking the closest identifiable factor listed. For example, some creditors consider only references from banks or other depository in stitutions and disregard finance company ref erences altogether; their statement of reasons should disclose “insufficient bank references,” not “insufficient credit references.” Similarly, a creditor that considers bank references and other credit references as distinct factors should treat the two factors separately and disclose them as appropriate. The creditor should either add such other factors to the form or check “other” and include the appro priate explanation. The creditor need not, however, describe how or why a factor ad versely affected the application. For example, the notice may say “length of residence” rath er than “too short a period of residence.” A creditor may design its own notification forms or use all or a portion of the forms con tained in this appendix. Proper use of Forms C-1 through C-4 will satisfy the requirement of section 202.9(a) (2) (i). Proper use of Forms C-5 and C-6 constitutes full compli ance with sections 202.9(a) (2) (ii) and 202.9(c)(2), respectively. Proper use of Forms C-1 and C-8 will satisfy the require ments of section 202.9(a) (2) (i) and (ii), re spectively, for applications for business credit. Form C-1—Sample Notice of Action Taken and Statement of Reasons Statement of Credit Denial, Termination, or Change Date Applicant’s Name: --------------------------------Applicant’s Address: -----------------------------Description of Account, Transaction, or Re quested Credit: Description of Action Taken: Part / —PRINCIPAL REASON (S) FOR CREDIT DENIAL, TERMINATION, OR OTHER ACTION TAKEN CONCERN ING CREDIT. This section must be complet ed in all instances. __ Credit application incomplete 27 Appendix C Regulation B __ Insufficient number of credit references __ Our credit decision was based in whole or provided in part on information obtained from an outside source other than a consumer re __ Unacceptable type of credit references provided porting agency. Under the Fair Credit Re __ Unable to verify credit references porting Act, you have the right to make a __ Temporary or irregular employment written request, no later than 60 days af __ Unable to verify employment ter you receive this notice, for disclosure __ Length of employment of the nature of this information. __ Income insufficient for amount of credit I f you have any questions regarding this notice, requested you should contact: __ Excessive obligations in relation to income Creditor’s nam e:________________________ __ Unable to verify income Creditor’s address: _____________________ __ Length of residence Creditor’s telephone n u m b e r : ____________ __ Temporary residence __ Unable to verify residence NOTICE: The federal Equal Credit Opportu __ No credit file nity Act prohibits creditors from discriminat __ Limited credit experience ing against credit applicants on the basis of __ Poor credit performance with us race, color, religion, national origin, sex, mari __ Delinquent past or present credit obliga tal status, age (provided the applicant has the tions with others capacity to enter into a binding contract); be __ Garnishment, attachment, foreclosure, re possession, collection action, or judgment cause all or part of the applicant’s income de rives from any public assistance program; or __ Bankruptcy — _____Value or type of collateral not sufficientbecause the applicant has in good faith exer cised any right under the Consumer Credit __ Other, specify: ______________________ Protection Act. The federal agency that ad ministers compliance with this law concerning this creditor is (name and address as specified by the appropriate agency listed in appendix Part / / —DISCLOSURE OF USE OF IN A). FORMATION OBTAINED FROM AN OUTSIDE SOURCE. This section should be completed if the credit decision was based in whole or in part on information that has been obtained from an outside source. — Our credit decision was based in whole or in part on information obtained in a re port from the consumer reporting agency listed below. You have a right under the Fair Credit Reporting Act to know the information contained in your credit file at the consumer reporting agency. The re porting agency played no part in our deci sion and is unable to supply specific rea sons why we have denied credit to you. Name: ___________________________ Address: _________________________ Telephone number: 28 Form C-2—Sample Notice of Action Taken and Statement of Reasons Date Dear Applicant: Thank you for your recent application. Your request for [a loan/a credit card/an in crease in your credit limit] was carefully con sidered, and we regret that we are unable to approve your application at this time, for the following reason (s): Your Income: __ is below our minimum requirement. __ is insufficient to sustain payments on the amount of credit requested. __ could not be verified. Appendix C Regulation B Your Employment: __ is not of sufficient length to qualify. __ could not be verified. Your Credit History: __ of making payments on time was not satisfactory. __ could not be verified. Your Application: __ lacks a sufficient number of credit references. __ lacks acceptable types of credit references. __ reveals that current obligations are ex cessive in relation to income. Other: _____________________________ The consumer reporting agency contacted that provided information that influenced our decision in whole or in part was [name, ad dress and telephone number of the reporting agency]. The reporting agency is unable to supply specific reasons why we have denied credit to you. You do, however, have a right under the Fair Credit Reporting Act to know the information contained in your credit file. Any questions regarding such information should be directed to [consumer reporting agency]. If you have any questions regarding this let ter you should contact us at [creditor’s name, address and telephone number]. NOTICE: The federal Equal Credit Opportu nity Act prohibits creditors from discriminat ing against credit applicants on the basis of race, color, religion, national origin, sex, mari tal status, age (provided the applicant has the capacity to enter into a binding contract); be cause all or part of the applicant’s income de rives from any public assistance program; or because the applicant has in good faith exer cised any right under the Consumer Credit Protection Act. The federal agency that ad ministers compliance with this law concerning this creditor is (name and address as specified by the appropriate agency listed in appendix A). F orm C-3— Sample N otice o f A ction T aken and Statem ent o f R easons (C redit Scoring) Date Dear Applicant: Thank you for your recent application fo r____________________ We regret that we are unable to approve your request. Your application was processed by a credit scoring system that assigns a numerical value to the various items of information we consid er in evaluating an application. These numeri cal values are based upon the results of analy ses of repayment histories of large numbers of customers. The information you provided in your ap plication did not score a sufficient number of points for approval of the application. The reasons you did not score well compared with other applicants were: • Insufficient bank references • Type of occupation • Insufficient credit experience In evaluating your application the consum er reporting agency listed below provided us with information that in whole or in part in fluenced our decision. The reporting agency played no part in our decision other than pro viding us with credit information about you. Under the Fair Credit Reporting Act, you have a right to know the information provided to us. It can be obtained by contacting: [name, address, and telephone number of the consumer reporting agency]. If you have any questions regarding this let ter, you should contact us at Creditor’s Name: -----------------------------Address: -----------------------------------------Telephone: --------------------------------------Sincerely, NOTICE: The federal Equal Credit Opportu nity Act prohibits creditors from discriminat ing against credit applicants on the basis of race, color, religion, national origin, sex, mari tal status, age (with certain limited excep tions); because all or part of the applicant’s 29 Appendix C Regulation B income derives from any public assistance program; or because the applicant has in good faith exercised any right under the Consumer Credit Protection Act. The federal agency that administers compliance with this law concerning this creditor is (name and address as specified by the appropriate agency listed in appendix A). Form C-4— Sample N otice o f A ction Taken, Statem ent o f Reasons, and Counteroffer Date Dear Applicant: Thank you for your application for ____________________ We are unable to of fer you credit on the terms that you requested for the following reason (s): We can, however, offer you credit on the following terms: _______________________ If this offer is acceptable to you, please noti fy us within [amount of time] at the following a d d re ss:______________________________ Our credit decision on your application was based in whole or in part on information ob tained in a report from [name, address and telephone number of the consumer reporting agency]. You have a right under the Fair Credit Reporting Act to know the informa tion contained in your credit file at the con sumer reporting agency. You should know that the federal Equal Credit Opportunity Act prohibits creditors, such as ourselves, from discriminating against credit applicants on the basis of their race, color, religion, national origin, sex, marital status, age because they receive income from a public assistance program, or because they may have exercised their rights under the Consumer Credit Protection Act. If you be lieve there has been discrimination in han dling your application you should contact the [name and address of the appropriate federal enforcement agency listed in appendix A]. Sincerely, 30 F orm C-5— Sample D isclosure o f Flight to R equest Specific Reasons for C redit D enial Date Dear Applicant: Thank you for applying to us fo r________ After carefully reviewing your application, we are sorry to advise you that we cannot [open an account for you/grant a loan to you/increase your credit limit] at this time. If you would like a statement of specific reasons why your application was denied, please contact [our credit service manager] shown below within 60 days of the date of this letter. We will provide you with the statement of reasons within 30 days after receiving your request. Creditor’s Name Address Telephone number If we obtained information from a consumer reporting agency as part of our consideration of your application, its name, address, and tel ephone number is shown below. You can find out about the information contained in your file (if one was used) by contacting: Consumer reporting agency’s name Address Telephone number Sincerely, NOTICE: The federal Equal Credit Opportu nity Act prohibits creditors from discriminat ing against credit applicants on the basis of race, color, religion, national origin, sex, mari tal status, age (provided the applicant has the capacity to enter into a binding contract); be cause all or part of the applicant’s income de rives from any public assistance program; or because the applicant has in good faith exer cised any right under the Consumer Credit Protection Act. The federal agency that ad ministers compliance with this law concerning this creditor is (name and address as specified by the appropriate agency listed in appendix A). Regulation B Appendix C F O R M C-6— Sample N otice of Incom plete A pplication and Request for A dditional Inform ation Creditor’s name Address Telephone number Date Dear Applicant: Thank you for your application for credit. The following information is needed to make a decision on your application: ____________ We need to receive this information by (date) . If we do not receive it by that date, we will regrettably be unable to give fur ther consideration to your credit request. Sincerely, F O R M C-7— Sample N otice o f A ction Taken and Statem ent o f Reasons (Business C redit) Creditor’s Name Creditor’s address Date Dear Applicant: Thank you for applying to us for credit. We have given your request careful consideration, and regret that we are unable to extend credit to you at this time for the following reasons: [Insert appropriate reason, such as Value or type of collateral not sufficient Lack of established earnings record Slow or past due in trade or loan payments] Sincerely, NOTICE: The federal Equal Credit Opportu nity Act prohibits creditors from discriminat ing against credit applicants on the basis of race, color, religion, national origin, sex, mari tal status, age (provided the applicant has the capacity to enter into a binding contract); be cause all or part of the applicant’s income de rives from any public assistance program; or because the applicant has in good faith exer cised any right under the Consumer Credit Protection Act. The federal agency that ad ministers compliance with this law concerning this creditor is [name and address as specified by the appropriate agency listed in appendix A], F O R M C-8— Sample D isclosure of R ight to R equest Specific Reasons for C redit D enial G iven at Tim e of A pplication (Business C redit) Creditor’s name Creditor’s address If your application for business credit is de nied, you have the right to a written statement of the specific reasons for the denial. To ob tain the statement, please contact [name, ad dress and telephone number of the person or office from which the statement of reasons can be obtained] within 60 days from the date you are notified of our decision. We will send you a written statement of reasons for the denial within 30 days of receiving your request for the statement. NOTICE: The federal Equal Credit Opportu nity Act prohibits creditors from discriminat ing against credit applicants on the basis of race, color, religion, national origin, sex, mari tal status, age (provided the applicant has the capacity to enter into a binding contract); be cause all or part of the applicant’s income de rives from any public assistance program; or because the applicant has in good faith exer cised any right under the Consumer Credit Protection Act. The federal agency that ad ministers compliance with this law concerning this creditor is [name and address as specified by the appropriate agency listed in appendix A ], A P P E N D IX D — Issuance o f Staff Interpretations Official S ta ff Interpretations Officials in the Board’s Division of Consumer and Community Affairs are authorized to is sue official staff interpretations of this regula tion. These interpretations provide the protec tion afforded under section 706(e) of the act. Except in unusual circumstances, such inter pretations will not be issued separately but 31 Appendix D Regulation B will be incorporated in an official commentary to the regulation, which will be amended periodically. The Request should contain a complete state ment of all relevant facts concerning the issue, including copies of all pertinent documents. Requests fo r Issuance o f Official S ta ff Interpretations Scope o f Interpretations A request for an official staff interpretation should be in writing and addressed to the Di rector, Division of Consumer arid Community Affairs, Board of Governors of the Federal Reserve System, Washington, D.C. 20551. No staff interpretations will be issued approv ing creditors’ forms or statements. This re striction does not apply to forms or state ments whose use is required or sanctioned by a government agency. 32 Equal Credit Opportunity Act 15 USC 1691; as added by Pub. L. 93-495, Title V, 88 Stat. 1521 (October 28, 1974) P U B L IC LA W 93-495, T IT L E V Section 502 Findings and purpose 503 Amendment to the Consumer Credit Protection Act SE C T IO N 502— Findings and Purpose The Congress finds that there is a need to in sure that the various financial institutions and other firms engaged in the extensions of credit exercise their responsibility to make credit available with fairness, impartiality, and with out discrimination on the basis of sex or mari tal status. Economic stabilization would be enhanced and competition among the various financial institutions and other firms engaged in the extension of credit would be strength ened by an absence of discrimination on the basis of sex or marital status, as well as by the informed use of credit which Congress has heretofore sought to promote. It is the pur pose of this Act to require that financial institutions and other firms engaged in the ex tension of credit make that credit equally available to all creditworthy customers with out regard to sex or marital status. [15 use 1691 note.] SE C T IO N 503— A m endm ent to the C onsum er C redit Protection A ct The Consumer Credit Protection Act (Public Law 90-321) is amended by adding at the end thereof a new title VII: T IT L E V II— E Q U A L C R E D IT O P P O R T U N IT Y Section 701 Prohibited discrimination; reasons for adverse action 702 Definitions 703 Regulations 704 Administrative enforcement 705 706 707 708 709 Relation to State laws Civil liability Annual reports to Congress Effective date Short title SE C T IO N 701— Prohibited D iscrim ination; R easons for Adverse A ction* (a) It shall be unlawful for any creditor to discriminate against any applicant, with re spect to any aspect of a credit transaction— (1) on the basis of race, color, religion, na tional origin, sex or marital status, or age (provided the applicant has the capacity to contract); (2) because all or part of the applicant’s income derives from any public assistance program; or (3) because the applicant has in good faith exercised any right under the Consumer Credit Protection Act. (b) It shall not constitute discrimination for purposes of this title for a creditor— (1) to make an inquiry of marital status if such inquiry is for the purpose of ascertain ing the creditor’s rights and remedies appli cable to the particular extension of credit and not to discriminate in a determination of creditworthiness; (2) to make an inquiry of the applicant’s age or of whether the applicant’s income derives from any public assistance program if such inquiry is for the purpose of deter mining the amount and probable continu ance of income levels, credit history, or oth er pertinent element of creditworthiness as provided in regulations of the Board; (3) to use any empirically derived credit system which considers age if such system is demonstrably and statistically sound in accordance with regulations of the Board, except that in the operation of such system * Effective date for amendments to section 701 is M arch 23, 1977. All other amendments are effective upon enactment. 33 §701 the age of an elderly applicant may not be assigned a negative factor or value; or (4) to make an inquiry or to consider the age of an elderly applicant when the age of such applicant is to be used by the creditor in the extension of credit in favor of such applicant. (c) It is not a violation of this section for a creditor to refuse to extend credit offered pur suant to— (1) any credit assistance program express ly authorized by law for an economically disadvantaged class of persons; (2) any credit assistance program adminis tered by a nonprofit organization for its members or an economically disadvantaged class of persons; or (3) any special purpose credit program of fered by a profitmaking organization to meet special social needs which meets stan dards prescribed in regulations by the Board; if such refusal is required by or made pursu ant to such program. (d )(1 ) Within thirty days (or such longer reasonable time as specified in regulations of the Board for any class of credit transac tion) after receipt of a completed applica tion for credit, a creditor shall notify the applicant of its action on the application. (2) Each applicant against whom adverse action is taken shall be entitled to a state ment of reasons for such action from the creditor. A creditor satisfies this obligation by— (A ) providing statements of reasons in writing as a matter of course to appli cants against whom adverse action is tak en; or (B) giving written notification of ad verse action which discloses (i) the appli cant’s right to a statement of reasons within thirty days after receipt by the creditor of a request made within sixty days after such notification, and (ii) the identity of the person or office from which such statement may be obtained. Such statement may be given orally if the written notification advises the applicant of his right to have the statement of rea 34 Equal Credit Opportunity Act sons confirmed in writing on written request. (3) A statement of reasons meets the re quirements of this section only if it contains the specific reasons for the adverse action taken. (4) Where a creditor has been requested by a third party to make a specific extension of credit directly or indirectly to an appli cant, the notification and statement of rea sons required by this subsection may be made directly by such creditor, or indirect ly through the third party, provided in ei ther case that the identity of the creditor is disclosed. (5) The requirements of paragraph (2), (3), or (4) may be satisfied by verbal state ments or notifications in the case of any creditor who did not act on more than 150 applications during the calendar year pre ceding the calendar year in which the ad verse action is taken, as determined under regulations of the Board. (6) For purposes of this subsection, the term “adverse action” means a denial or revocation of credit, a change in the terms of an existing credit arrangement, or a re fusal to grant credit in substantially the amount or on substantially the terms re quested. Such term does not include a re fusal to extend additional credit under an existing credit arrangement where the ap plicant is delinquent or otherwise in default, or where such additional credit would ex ceed a previously established credit limit. [15 USC 1691. As amended by act of M arch 23, 1976 (90 Stat. 251).] S E C T IO N 702— Definitions (a) The definitions and rules of construction set forth in this section are applicable for the purposes of this title. (b) The term “applicant” means any person who applies to a creditor directly for an extension, renewal, or continuation of credit, or applies to a creditor indirectly by use of an existing credit plan for an amount exceeding a previously established credit limit. Equal Credit Opportunity Act (c) The term “Board” refers to the Board of Governors of the Federal Reserve System. (d) The term “credit” means the right grant ed by a creditor to a debtor to defer payment of debt or to incur debt and defer its payment or to purchase property or services and defer payment therefor. (e) The term “creditor” means any person who regularly extends, renews, or continues credit; any person who regularly arranges for the extension, renewal, or continuation of credit; or any assignee of an original creditor who participates in the decision to extend, re new, or continue credit. (f) The term “person” means a natural per son, a corporation, government or govern mental subdivision or agency, trust, estate, partnership, cooperative, or association. (g) Any reference to any requirement im posed under this title or any provision thereof includes reference to the regulations of the Board under this title or the provision thereof in question. [15 USC 1691a.] SE C T IO N 703— Regulations (a)(1 ) The Board shall prescribe regulations to carry out the purposes of this title. These regulations may contain but are not limited to such classifications, differentiation, or other provision, and may provide for such adjustments and exceptions for any class of transactions, as in the judgment of the Board are necessary or proper to effectuate the purposes of this title, to prevent circum vention or evasion thereof, or to facilitate or substantiate compliance therewith. (2) Such regulations may exempt from the provisions of this title any class of transac tions that are not primarily for personal, family, or household purposes, or business or commercial loans made available by a financial institution, except that a particular type within a class of such transactions may be exempted if the Board determines, after making an express finding that the applica §703 tion of this title or of any provision of this title of such transaction would not contrib ute substantially to effecting the purposes of this title. (3) An exemption granted pursuant to paragraph (2) shall be for no longer than five years and shall be extended only if the Board makes a subsequent determination, in the manner described by such paragraph, that such exemption remains appropriate. (4) Pursuant to Board regulations, entities making business or commercial loans shall maintain such records or other data relat ing to such loans as may be necessary to evidence compliance with this subsection or enforce any action pursuant to the authori ty of this Act. In no event shall such rec ords or data be maintained for a period of less than one year. The Board shall promul gate regulations to implement this para graph in the manner prescribed by chapter 5 of title 5, United States Code. (5) The Board shall provide in regulations that an applicant for a business or commer cial loan shall be provided a written notice of such applicant’s right to receive a written statement of the reasons for the denial of such loan. (b) The Board shall establish a Consumer Advisory Council to advise and consult with it in the exercise of its functions under the Consumer Credit Protection Act and to ad vise and consult with it concerning other con sumer related matters it may place before the Council. In appointing the members of the Council, the Board shall seek to achieve a fair representation of the interests of creditors and consumers. The Council shall meet from time to time at the call of the Board. Members of the Council who are not regular full-time em ployees of the United States shall, while at tending meetings of such Council, be entitled to receive compensation at a rate fixed by the Board, but not exceeding $100 per day, in cluding travel time. Such members may be al lowed travel expenses, including transporta tion and subsistence, while away from their homes or regular place of business. [15 USC 1691b. As amended by acts of M arch 23, 1976 (90 Stat. 252) and Oct. 25, 1988 (102 Stat. 2692).] 35 §704 SE C T IO N 704— A dm inistrative Enforcem ent (a) Compliance with the requirements im posed under this title shall be enforced under: (1) Section 8 of the Federal Deposit Insur ance Act, in the case of— (A) national banks, by the Comptroller of the Currency; (B) member banks of the Federal Re serve System (other than national banks), by the Board; (C) banks insured by the Federal Depo sit Insurance Corporation (other than members of the Federal Reserve Sys tem), by the Board of Directors of the Federal Deposit Insurance Corporation. (2) Section 8 of the Federal Deposit Insur ance Act, by the Director of the Office of Thrift Supervision, in the case of a savings association the deposits of which are in sured by the Federal Deposit Insurance Corporation. (3) The Federal Credit Union Act, by the Administrator of the National Credit Un ion Administration with respect to any Federal Credit Union. (4) The Acts to regulate commerce, by the Interstate Commerce Commission with re spect to any common carrier subject to those Acts. (5) The Federal Aviation Act of 1958, by the Secretary of Transportation with re spect to any air carrier or foreign air carrier subject to that Act. (6) The Packers and Stockyards Act, 1921 (except as provided in section 406 of that Act), by the Secretary of Agriculture with respect to any activities subject to that Act. (7) The Farm Credit Act of 1971, by the Farm Credit Administration with respect to any Federal land bank, Federal land bank association, Federal intermediate credit bank, and production credit association. (8) The Securities Exchange Act of 1934, by the Securities and Exchange Commis sion with respect to brokers and dealers; and (9) The Small Business Investment Act of 1958, by the Small Business Administra tion, with respect to small business invest ment companies. Equal Credit Opportunity Act (b) For the purpose of the exercise by any agency referred to in subsection (a) of its powers under any Act referred to in that sub section, a violation of any requirement im posed under this title shall be deemed to be a violation of a requirement imposed under that Act. In addition to its powers under any pro vision of law specifically referred to in subsec tion (a), each of the agencies referred to in that subsection may exercise for the purpose of enforcing compliance with any requirement imposed under this title, any other authority conferred on it by law. The exercise of the authorities of any of the agencies referred to in subsection (a) for the purpose of enforcing compliance with any requirement imposed under this title shall in no way preclude the exercise of such authorities for the purpose of enforcing compliance with any other provi sion of law not relating to the prohibition of discrimination on the basis of sex or marital status with respect to any aspect of a credit transaction. (c) Except to the extent that enforcement of the requirements imposed under this title is specifically committed to some other Govern ment agency under subsection (a), the Feder al Trade Commission shall enforce such re quirements. For the purpose of the exercise by the Federal Trade Commission of its func tions and powers under the Federal Trade Commission Act, a violation of any require ment imposed under this title shall be deemed a violation of a requirement imposed under that Act. All of the functions and powers of the Federal Trade Commission under the Federal Trade Commission Act are available to the Commission to enforce compliance by any person with the requirements imposed un der this title, irrespective of whether that per son is engaged in commerce or meets any oth er jurisdictional tests in the Federal Trade Commission Act, including the power to en force any Federal Reserve Board regulation promulgated under this title in the same man ner as if the violation had been a violation of a Federal Trade Commission trade regulation rule. (d) The authority of the Board to issue regu lations under this title does not impair the au thority of any other agency designated in this §706 Equal Credit Opportunity Act section to make rules respecting its own pro cedures in enforcing compliance with require ments imposed under this title. [15 USC 1691c. As amended by acts o f M arch 23, 1976 (90 Stat. 253); Oct. 3, 1984 (98 Stat. 1708); and Aug. 9, 1989 (103 Stat. 439).] SE C T IO N 705— R elation to State Laws (a) A request for the signature of both par ties to a marriage for the purpose of creating a valid lien, passing clear title, waiving inchoate rights to property, or assigning earnings, shall not constitute discrimination under this title. Provided, however, That this provision shall not be construed to permit a creditor to take sex or marital status into account in connec tion with the evaluation of creditworthiness of any applicant. (b) Consideration or application of State property laws directly or indirectly affecting creditworthiness shall not constitute discrimi nation for purposes of this title. (c) Any provision of State law which prohib its the separate extension of consumer credit to each party to a marriage shall not apply in any case where each party to a marriage vol untarily applies for separate credit from the same creditor: Provided, That in any case where such a State law is so preempted, each party to the marriage shall be solely responsi ble for the debt so contracted. (d) When each party to a marriage separate ly and voluntarily applies for and obtains sep arate credit accounts with the same creditor, those accounts shall not be aggregated or oth erwise combined for purposes of determining permissible finance charges or permissible loan ceilings under the laws of any State or of the United States. (e) Where the same act or omission consti tutes a violation of this title and of applicable State law, a person aggrieved by such conduct may bring a legal action to recover monetary damages either under this title or under such State law, but not both. This election of reme dies shall not apply to court actions in which the relief sought does not include monetary damages or to administrative actions. (f) This title does not annul, alter, or affect, or exempt any person subject to the provisions of this title from complying with, the laws of any State with respect to credit discrimina tion, except to the extent that those laws are inconsistent with any provision of this title, and then only to the extent of the inconsist ency. The Board is authorized to determine whether such inconsistencies exist. The Board may not determine that any State law is in consistent with any provision of this title if the Board determines that such law gives greater protection to the applicant. (g) The Board shall by regulation exempt from the requirements of sections 701 and 702 of this title any class of credit transactions within any State if it determines that under the law of that State that class of transactions is subject to requirements substantially similar to those imposed under this title or that such law gives greater protection to the applicant, and that there is adequate provision for en forcement. Failure to comply with any re quirement of such State law in any transaction so exempted shall constitute a violation of this title for the purposes of section 706. [15 USC 1691d. A s amended by act o f M arch 23, 1976 (90 Stat. 253).] SE C T IO N 706— Civil Liability (a) Any creditor who fails to comply with any requirement imposed under this title shall be liable to the aggrieved applicant for any actual damages sustained by such applicant acting either in an individual capacity or as a member of a class. (b) Any creditor, other than a government or governmental subdivision or agency, who fails to comply with any requirement imposed under this title shall be liable to the aggrieved applicant for punitive damages in an amount not greater than $10,000, in addition to any actual damages provided in subsection (a), except that in the case of a class action the total recovery under this subsection shall not exceed the lesser of $500,000 or 1 per centum of the net worth of the creditor. In determin ing the amount of such damages in any action, the court shall consider, among other relevant 37 §706 factors, the amount of any actual damages awarded, the frequency and persistence of fail ures of compliance by the creditor, the re sources of the creditor, the number of persons adversely affected, and the extent to which the creditor’s failure of compliance was intentional. (c) Upon application by an aggrieved appli cant, the appropriate United States district court or any other court of competent juris diction may grant such equitable and declara tory relief as is necessary to enforce the re quirements imposed under this title. (d) In the case of any successful action under subsection (a), (b), or (c), the costs of the action, together with a reasonable attorney’s fee as determined by the court, shall be added to any damages awarded by the court under such subsection. (e) No provision of this title imposing any liability shall apply to any act done or omitted in good faith in conformity with any official rule, regulation, or interpretation thereof by the Board or in conformity with any interpre tation or approval by an official or employee of the Federal Reserve System duly autho rized by the Board to issue such interpreta tions or approvals under such procedures as the Board may prescribe therefor, notwith standing that after such act or omission has occurred, such rule, regulation, interpretation, or approval is amended, rescinded, or deter mined by judicial or other authority to be in valid for any reason. (f) Any action under this section may be brought in the appropriate United States dis trict court without regard to the amount in controversy, or in any other court of compe tent jurisdiction. No such action shall be brought later than two years from the date of the occurrence of the violation, except that— (1) whenever any agency having responsi bility for administrative enforcement under section 704 commences an enforcement proceeding within two years from the date of the occurrence of the violation, (2) whenever the Attorney General com mences a civil action under this section within two years from the date of occur rence of the violation, 38 Equal Credit Opportunity Act then any applicant who has been a victim of the discrimination which is the subject of such proceeding or civil action may bring an action under this section not later than one year after the commencement of that proceeding or action. (g) The agencies having responsibility for ad ministrative enforcement under section 704, if unable to obtain compliance with section 701, are authorized to refer the matter to the At torney General with a recommendation that an appropriate civil action be instituted. (h) When a matter is referred to the Attor ney General pursuant to subsection (g), or whenever he has reason to believe that one or more creditors are engaged in a pattern or practice in violation of this title, the Attorney General may bring a civil action in any appro priate United States district court for such re lief as may be appropriate, including injunc tive relief. (i) No person aggrieved by a violation of this title and by a violation of section 805 of the Civil Rights Act of 1968 shall recover under this title and section 812 of the Civil Rights Act of 1968, if such violation is based on the same transaction. (j) Nothing in this title shall be construed to prohibit the discovery of a creditor’s credit granting standards under appropriate discov ery procedures in the court or agency in which an action or proceeding is brought. [15 USC 1691e. As amended by act of M arch 23, 1976 (90 Stat. 253).] SE C T IO N 707— A nnual R eports to Congress Each year, the Board and the Attorney Gen eral shall, respectively, make reports to the Congress concerning the administration of their functions under this title, including such recommendations as the Board and the Attor ney General, respectively, deem necessary or appropriate. In addition, each report of the Board shall include its assessment of the ex tent to which compliance with the require ments of this title is being achieved, and a summary of the enforcement actions taken by §709 Equal Credit Opportunity Act each of the agencies assigned administrative enforcement responsibilities under section 704. [15 USC 1691f. As added by act o f M arch 23, 1976 (90 Stat. 255) and amended by act o f M arch 31, 1980 (94 Stat. 174).] shall apply to any violation occurring on or after such date, except that the amendments made to section 701 of the Equal Credit Op portunity Act shall take effect 12 months after the date of enactment. [15 USC 1691 note.) SE C T IO N 708— Effective D ate This title takes effect upon the expiration of one year after the date of its enactment. The amendments made by the Equal Credit Op portunity Act Amendments of 1976 shall take effect on the date of enactment thereof and SE C T IO N 709— Short Title This title may be cited as the “Equal Credit Opportunity Act.” [15 USC 1691 note.] Board of Governors of the Federal Reserve System Regulation C Home Mortgage Disclosure 12 CFR 203; as amended effective January 1, 1990 Any inquiry relating to this regulation should be addressed to the Federal Reserve Bank of the District in which the inquiry arises. February 1990 Contents Section 203.1—Authority, purpose, and scope ...................................................... (a) A uthority...................................... (b) Purpose.......................................... (c) Scope.............................................. (d) Loan aggregation and central data depositories .................................. Section 203.2—Definitions........................ Section 203.3—Exempt institutions.......... (a) Exemption based on asset size or location.......................................... (b) Exemption based on state law . . . . (c) Loss of exem ption........................ Section 203.4— Compilation of loan data . (a) Data format and itemization........ (b) Collection of data on race or national origin, sex, and income .. (c) Optional d a ta ................................ 2 2 2 3 3 Page (d) Excluded d a t a ............................. 3 Section 203.5—Disclosure and reporting . 3 (a) Reporting requirements ............. 3 (b) Disclosure to the public............... 3 (c) Availability of disclosure statem en t...................................... 3 (d) Notice of availability................... 4 Section 203.6—Enforcem ent.................... 4 (a) Administrative enforcement....... 4 (b) Bona fide erro rs........................... 4 Appendix A—Forms and instructions for loan/application re g iste r...................... 4 Appendix B—Form and instructions for data collection on race or national origin and sex ........................................ 15 3 3 HOME MORTGAGE DISCLOSURE A C T ............................................................ 17 1 1 1 I 1 1 2 Regulation C Home Mortgage Disclosure 12 C FR 203*; as revised effective January 1, 1990 ^Section 203.1 Authority, purpose, and scope 203.2 Definitions 203.3 Exempt institutions 203.4 Compilation of loan data 203.5 Disclosure and reporting 203.6 Enforcement Appendix A—Form and instructions for loan/application register Appendix B—Form and instructions for data collection on race or national origin and sex SE C T IO N 203.1— A uthority, Purpose, and Scope (a) Authority. This regulation is issued by the Board of Governors of the Federal Reserve System (“Board” ) pursuant to the Home Mortgage Disclosure Act (12 USC 2801 et seq.), as amended. The information-collection requirements have been approved by the U.S. Office of Management and Budget under 44 USC 3501 et seq. and have been assigned OMB No. 7100-0247. (b) Purpose. (1) This regulation implements the Home Mortgage Disclosure Act, which is intended to provide the public with loan data that can be used— (i) to help determine whether financial institutions are serving the housing needs of their communities; (ii) to assist public officials in distribut ing public-sector investments so as to at tract private investment to areas where it is needed; and (iii) to assist in identifying possible dis criminatory lending patterns and enforc ing antidiscrimination statutes. (2) Neither the act nor this regulation is intended to encourage unsound lending practices or the allocation of credit. (c) Scope. This regulation applies to certain financial institutions, including banks, saving * 203. Code o f Federal Regulations, title 12, chapter II, part associations, credit unions, and other mort gage lending institutions, as defined in section 203.2(e). It requires an institution to report data to its supervisory agency about homepurchase and home-improvement loans it originates or purchases, or for which it re ceives applications; and to disclose certain data to the public. (d) Loan aggregation and central data depos itories. Using the loan data made available by financial institutions, the Federal Financial Institutions Examination Council will prepare disclosure statements and will produce vari ous reports for individual institutions for each metropolitan statistical area (MSA), showing lending patterns by location, age of housing stock, income level, sex, and racial character istics. The disclosure statements and reports will be available to the public at central data depositories located in each MSA. A listing of central data depositories can be obtained from the Federal Financial Institutions Examina tion Council, Washington, D.C. 20006. SE C T IO N 203.2— Definitions In this regulation— (a) Act means the Home Mortgage Disclo sure Act (12 USC 2801 et seq.), as amended. (b) Application means an oral or written re quest for a home-purchase or home-improvement loan that is made in accordance with procedures established by a financial institu tion for the type of credit requested. (c) Branch office means— (1) any office of a bank, savings associa tion, or credit union that is approved as a branch by a federal or state supervisory agency, but excludes free-standing electron ic terminals such as automated teller machines; (2) any office of a mortgage-lending insti tution (other than a bank, savings associa1 § 203.2 tion, or credit union) that takes applica tions from the public for home-purchase or home-improvement loans. A mortgagelending institution is also deemed to have a branch office in an MSA if, in the preceding calendar year, it received applications for, originated, or purchased five or more homepurchase or home-improvement loans on property located in that MSA. (d) Dwelling means a residential structure (whether or not it is attached to real proper ty) located in a state of the United States of America, the District of Columbia, or the Commonwealth of Puerto Rico. The term in cludes an individual condominium unit, coop erative unit, or mobile or manufactured home. (e) Financial institution means— (1) a bank, savings association, or credit union that originated in the preceding cal endar year a home-purchase loan (other than temporary financing such as a con struction loan) secured by a first lien on a one- to four-family dwelling if— (i) the institution is federally insured or regulated; or (ii) the loan is insured, guaranteed, or supplemented by any federal agency; or (iii) the institution intended to sell the loan to the Federal National Mortgage Association or the Federal Home Loan Mortgage Corporation; (2) a for-profit mortgage-lending institu tion (other than a bank, savings associa tion, or credit union) whose home-purchase loan originations equaled or exceeded 10 percent of its loan volume, measured in dol lars, in the preceding calendar year. (f) Home-improvement loan means any loan that— (1) is stated by the borrower (at the time of the loan application) to be for the pur pose of repairing, rehabilitating, or remod eling a dwelling; and (2) is classified by the financial institution as a home-improvement loan. (g) Home-purchase loan means any loan se cured by and made for the purpose of pur chasing a dwelling. (h) Metropolitan statistical area or MSA 2 Regulation C means a metropolitan statistical area or a pri mary metropolitan statistical area, as defined by the U.S. Office of Management and S E C T IO N 203.3— Exem pt Institutions (a) Exemption based on asset size or location. A financial institution is exempt from the re quirements of this regulation for a given cal endar year if on the preceding December 31— (1) the institution had neither a home of fice nor a branch office in an MSA; or (2) in the case of a bank, savings associa tion, or credit union, the institution’s total assets were $10 million or less; or (3) in the case of a for-profit mortgagelending institution (other than a bank, sav ings association, or credit union), the total assets of the institution combined with those of any parent corporation were $10 million or less. (b) Exemption based on state law. (1) A state-chartered or state-licensed financial institution is exempt from the requirements of this regulation if the Board determines that the institution is subject to a state dis closure law that contains requirements sub stantially similar to those imposed by this regulation and contains adequate provisions for enforcement. | (2) Any state, state-chartered, or statelicensed financial institution, or association of such institutions may apply to the Board for any exemption under this paragraph. (3) An institution that is exempt under this paragraph shall submit the data re quired by the state disclosure law to its state supervisory agency for purposes of aggregation. (c) Loss o f exemption. (1) An institution los ing an exemption that was based on asset size or location under paragraph (a) of this section shall comply with this regulation beginning with the calendar year following the year in which it lost its exemption. (2) An institution losing an exemption that was based on state law under para graph (b) of this section shall comply with this regulation beginning with the calendar Regulation C year following the year for which it last re ported loan data under the state disclosure law. SECTION 203.4— Compilation of Loan Data (a) Data form at and itemization. A financial institution shall collect data regarding appli cations for, and originations and purchases of, home-purchase loans (including refinancings) and home-improvement loans for each calen dar year. These data shall be presented on a register in the format prescribed in appendix A and shall include the following items: (1) A number for the loan or loan applica tion, and the date the application was received. (2) The type and purpose of the loan. (3) The owner-occupancy status of the property to which the loan relates. (4) The amount of the loan or application. (5) The type of action taken, and the date. (6) The location of the property to which the loan relates, by MSA, state, county, and census tract, if the institution has a home or branch office in that MSA. (7) The race or national origin and sex of the applicant or borrower, and the income relied upon in processing the loan application. (8) The type of entity purchasing a loan that the institution originates or purchases and then sells within the same calendar year. (b) Collection o f data on race or national ori gin, sex, and income. (1) A financial institution shall collect data about the race or national origin and sex of the applicant or borrower as pre scribed in appendix B. If the applicant or borrower chooses not to provide the infor mation, the lender shall note the data on the basis of visual observation or surname, to the extent possible. (2) Race or national origin, sex, and in come data may but need not be collected for— (i) loans purchased by the financial in stitution; or (ii) applications received or loans origi § 203.5 nated by a bank, savings association, or credit union with assets on the preceding December 31 of $30 million or less. (c) Optional data. A financial institution may report the reasons it denied a loan application. (d) Excluded data. A financial institution shall not report— (1) loans originated or purchased by the financial institution acting in a fiduciary ca pacity (such as trustee); (2) loans on unimproved land; (3) temporary financing (such as bridge or construction loans); (4) the purchase of an interest in a pool of loans (such as mortgage-participation cer tificates); or (5) the purchase solely of the right to serv ice loans. SECTION 203.5—Disclosure and Reporting (a) Reporting requirements. By March 1 fol lowing the calendar year for which the loan data are compiled, a financial institution shall send two copies of its complete register to the agency office specified in appendix A of this regulation, and shall retain a copy for its rec ords for a period of not less than two years. (b) Disclosure to the public. A financial insti tution shall make its mortgage-loan disclosure statement (to be prepared by the Federal Fi nancial Institutions Examination Council) available to the public no later than 30 calen dar days after the institution receives it from its supervisory agency. The financial institu tion shall make the statement available to the public for a period of five years. (c) Availability o f disclosure statement. A fi nancial institution shall make the disclosure statement available at its home office. If it has a physical branch office in other MSAs, it shall also make a statement available in at least one branch office in each of those MSAs; the statement at a branch office need only con tain data relating to property in the MSA where that branch office is located. An institu tion shall make the disclosure statement avail able for inspection and copying during the 3 Regulation C § 203.5 hours the office is normally open to the public for business. It may impose a reasonable charge for photocopying services. (d) Notice o f availability. A financial institu tion shall post a general notice about the availability of its disclosure statement in the lobbies of its home office and any physical branch offices located in an MSA. Upon re quest, it shall promptly provide the location of the institution’s offices where the statement is available. At its option, an institution may in clude the location in its notice. SE C T IO N 203.6— Enforcem ent (a) Administrative enforcement. A violation of the act or this regulation is subject to ad ministrative sanctions as provided in section 305 of the act. Compliance is enforced by the agencies listed in appendix A of this regulation. (b) Bona fide errors. An error in compiling or recording loan data is not a violation of the act or this regulation if it was unintentional and occurred despite the maintenance of pro cedures reasonably adopted to avoid such errors. A P P E N D IX A — F orm and Instructions for L oan/A pplication R egister L oan/A pplication R egister F orm Public reporting burden for this collection of information is estimated to vary from 10 to 750 hours per response, with an average of 120 hours per response, including time to gather and maintain the data needed and to review instructions and complete the informa tion collection. Send comments regarding this burden estimate or any other aspect of this collection of information, including sugges tions for reducing the burden, to Secretary, Board of Governors of the Federal Reserve System, Washington, D.C. 20551; and to the Office of Information and Regulatory Affairs, Office of Management and Budget, Washing ton, D.C. 20503. 4 Instructions to Lending Institutions I. General A. Who must file a report 1. Subject to some exceptions that are dis cussed below, banks, savings associations, credit unions, and other mortgage-lending institutions must complete a register listing data about loan applications received, loans originated, and loans purchased if on the preceding December 31 the institution— a. had assets of more than $10 million, and b. had a home or a branch office in a “metropolitan statistical area” or a “pri mary metropolitan statistical area” (both are referred to in these instructions by the term “MSA” ). Example: If on December 31, 1989, you had a home or a branch office in an MSA and your assets exceeded $10 million, you must complete a register that lists the home-purchase and home-improvement loans that you originate or purchase during calendar year 1990, and also lists applica tions that did not result in an origination. 2. You need not complete a register—even if the tests for asset size and location are met—if your institution is a bank, savings association, or credit union and it made no first-lien home-purchase loans on one- to four-family dwellings in the preceding cal endar year. 3. You need not complete a register—even if the tests for asset size and location are met— if your institution is a for-profit mortgage lender (other than a bank, savings associa tion, or credit union) and the home-purchase loans that you originated in the preceding year came to less than 10 percent of your total loan volume, measured in dollars. 4. If you are a for-profit mortgage lender (other than a bank, savings association, or credit union) the asset test is based on the combined assets of your institution and any parent corporation. 5. If you are the subsidiary of a bank or savings association, you must complete a separate register for your institution and submit it, directly or through your parent, to the agency that supervises your parent. Regulation C Appendix A B. Institutions exempted from HMDA. Insti tutions that are specifically exempted by the Federal Reserve Board from complying with federal law because they are covered by a sim ilar state law on mortgage loan disclosures must use the disclosure form required by their state law. C. Format 1. You must use the format of this loan/ application register, but you are not re quired to use the form itself. For example, you may produce a computer printout in stead. The layout must conform exactly, however, to that of this register, including the order of columns, column headings, etc. Or you may submit the data in machinereadable form (see paragraph D.2. below). 2. The required data are to be entered in the register for each loan origination, each application acted upon during the calendar year, and each loan purchased. Your insti tution will have to decide on the procedure it wants to follow—whether to begin enter ing the required data when an application is received, or to enter the data when final ac tion is taken (such as when a loan goes to closing or an application is denied). Keep in mind that an application is to be reported in the calendar year when final action is taken. Loan originations are to be reported in the year they go to closing; do not report applications for loans that have been ap proved but that have not yet gone to closing at year-end. 3. Your institution may use separate regis ters at different branches, or separate regis ters for different loan types (such as for home-purchase or home-improvement loans, or for loans on multifamily dwell ings). But you must submit the registers to your supervisory agency in one package, with the prescribed transmittal sheet; and an officer of your institution must certify to the accuracy of the data. 4. Entries need not be grouped by MSA, or chronologically, or by census-tract num bers, or in any other particular order. But make sure the application or loan numbers (discussed under paragraph Il.C .l.a. be low) are unique. If separate registers are be ing maintained in various branches, your institution could add a letter code to identi fy different branches, or assign series of numbers to each branch, to avoid duplicate numbers. 5. Number each page of your report, indi cating the total number of pages (for exam ple, “Page 1 of 24” ). D. Submission o f report; release o f disclosure statements 1. You must submit the register to the of fice specified by your federal supervisory agency no later than March 1 following the calendar year for which the data are com piled. A list of the agencies appears at the end of these instructions. 2. Institutions are encouraged to submit data in machine-readable form. Contact your federal supervisory agency for infor mation regarding electronic submission. 3. If you submit your register in hard copy, you must send two copies. 4. The FFIEC (Federal Financial Institu tions Examination Council) will prepare a disclosure statement from the data that you submit. Your disclosure statement will be returned to you at the address that you in dicate on the transmittal sheet. When you receive that disclosure statement you must make a copy available for inspection by the public within 30 calendar days. You must make it available at your home office and, if you have physical branch offices in other MSAs, at one branch office in each of those MSAs. (Your agency can provide you with HMDA posters that you can use to inform the public of the availability of your disclo sure statement.) II. A. Completion o f Register Data to be shown 1. Show the data on home-purchase and home-improvement loans that you originat ed (or that were originated in your name) and loans that you purchased during the calendar year covered by the report. Report these data even if the loans were subse quently sold. Include refinancings of home purchase loans. 2. For these same types of loans, show the data for applications that did not result in originations—for example, applications 5 Appendix A that your institution denied or that the ap plicant withdrew during the calendar year covered by the report. Include applications that were received in the previous calendar year but not acted upon until the calendar year covered by the register. B. Data to be excluded. Do not report the following loans or applications for loans: 1. Loans that, although secured by real es tate, are made for purposes other than home purchase, home improvement, or refi nancing (for example, do not report a loan secured by residential real property for pur poses of financing college tuition, a vaca tion, or business operations); 2. Loans received in a fiduciary capacity (for example, by your trust department); 3. Loans on unimproved land; 4. Construction or bridge loans and other temporary financing; 5. The purchase of an interest in a pool of loans (such as mortgage-participation cer tificates); or 6. The purchase solely of the right to serv ice loans. C. Itemization o f data. Your loan/applica tion register must include the following: 1. Application or loan information. a. Application or loan number. Enter an identifying number or code that can be used later to retrieve the loan or appli cation file. It can be any number of your choosing (not exceeding 25 characters). You may use letters, numerals, or a com bination of both. But make sure that all numbers are unique within your institu tion. If your register contains data for branch offices, for example, you could use codes to identify the loans or applica tions of particular branches, or could as sign certain series of numbers to particu lar branches to avoid duplicate numbers. b. Date application received. Enter the date the loan application was received by your institution by month, day, and year, using numerals (for example, 02/28/90). Or if your institution normally records the date shown on the application form, you may use that date. Enter “NA” for loans purchased by your institution. Regulation C c. Type. Indicate the type of loan (or loan application) by entering the applica ble code from the following: 1—Conventional (any loan other than FHA, VA or FmHA loans) 2—FHA-insured (Federal Housing Administration) 3—VA-guaranteed (Veterans Admin istration) 4 —FmHA-insured (Farmers Home Administration) d. Purpose. Indicate the purpose of the loan or application by entering the appli cable code from the following: 1—Home purchase (one- to four-family) 2—Home improvement (one- to fourfamily) 3—Refinancing (home purchase, one- to four-family) 4 —Multifamily dwelling (home pur chase, home improvement, and refinancings) e. Explanation o f purpose codes. Code 1: Home purchase i. This code applies to loans made, and to applications for loans, for the pur pose of purchasing a residential dwell ing for one to four families, if the loan is secured by a lien. ii. At your option, you may use code 1 for loans that are made for homeimprovement purposes but are secured by a first lien, if you normally classify such first-lien loans as home-purchase loans. Code 2: Home improvement i. Code 2 applies to loans and applica tions for loans that (1) the borrowers have said will be used for repairing, re habilitating, or remodeling one- to four-family residential dwellings, and (2) are recorded on your books as home-improvement loans. ii. Report both secured and unsecured loans. iii. At your option, you may record a home-equity line of credit as a homeimprovement loan if the borrower or applicant indicates at the time of appli cation or when the account is opened Regulation C that some portion of the proceeds will be used for home improvement. (For such credit lines, under “Amount” in paragraph g. below, enter only that portion of the line which the borrower or applicant indicates will be for homeimprovement purposes.) Report only in the year the line is established. Code 3: Refinancings i. Use this code only for refinancings of home-purchase loans on one- to four-family residential dwellings. ii. Use this code whether or not you were the original creditor on the loan being refinanced, and whether or not the refinancing results in an increase in the outstanding principal. iii. Report the full amount of a refi nancing if more than 50 percent of the loan proceeds is for home purchase or home improvement. You may treat the amount that is equivalent to the un paid principal of the original loan as being for home purchase. Code 4: M ultifamily dwelling i. Use this code for loans and loan ap plications on dwellings for five or more families, including home-purchase loans, refinancings, and loans for re pairing, rehabilitation, and remodeling purposes. ii. Do not use this code for loans on individual condominium or coopera tive units; use codes 1, 2, or 3 for such loans, as applicable. f. Occupancy. Use the applicable code to indicate whether the property to which the loan or loan application relates is to be owner-occupied as a principal dwelling. 1—Owner-occupied as a principal dwelling 2—Not owner-occupied 3—Not applicable i. Use code 2 for loans on second homes or vacation homes, as well as on rental properties. ii. Use code 2 only for nonoccupant loans or applications related to one- to four-family dwellings (including indi vidual condominium or cooperative units). Appendix A iii. Use code 3 if the property to which the loan relates is a multifamily dwell ing; is not located in an MSA; or is located in an MSA in which your insti tution has neither a home nor a branch office. iv. For purchased loans, you may as sume that the property will be owneroccupied as a principal dwelling unless the loan documents or application con tain information to the contrary. g. Amount. Enter the amount of the loan or application. Round to the nearest thousand ($500 should be rounded up to $1,000). Show in terms of thousands; for example, a loan for $167,300 should be entered as 167. i. For home-purchase loans that you originate, “amount” means the origi nal principal amount of the loan. For home-purchase loans that you pur chase, “amount” means the unpaid principal balance of the loan at the time of purchase. ii. For home-improvement loans (both originations and purchases), you may include unpaid finance charges in the amount if that is how you record such loans on your books. iii. For lines of credit secured by home equity, include only that portion of the line indicated by the applicant or bor rower at the time the application is made or when the account is opened as being for the purpose of home im provement. Report only in the year the line is established. iv. For a loan application that was de nied or withdrawn, enter the amount applied for. v. If you offered to lend less than the applicant applied for, enter the amount of the loan if the offer was accepted by the applicant. If the offer was not ac cepted, enter the amount initially ap plied for. 2. Action taken. Indicate the type of action taken on the application or loan by using the following codes: 1—Loan originated 7 Appendix A 2—Application approved but not accepted by applicant 3—Application denied 4— Application withdrawn 5—File closed for incompleteness 6—Loan purchased by your institution a. Type o f action taken. Do not report any loan application still pending at the end of the calendar year. You will report that application in your register for the year final action is taken. i. Use code 2 where an application has been approved by you, but where the applicant fails to respond to your noti fication of approval or your commit ment letter within the specified time. ii. Use code 4 only when an applica tion has been expressly withdrawn by the applicant. iii. Use code 5 if you sent a written notice of incompleteness under section 202.9(c) of Regulation B (Equal Credit Opportunity) and if the appli cant failed to respond to your request for additional information within the period of time specified in your notice. b. Date. Enter the date by month, day, and year, using numerals (for example, 02/28/90). i. For loans originated, enter the set tlement or closing date. ii. For applications denied, applica tions approved but not accepted by the applicant, and files closed for incom pleteness, enter the date that the action was taken by your institution or the date the notice was sent to the applicant. iii. For applications withdrawn, enter the date that you received the appli cant’s express withdrawal; or you may enter the date shown on the notifica tion from the applicant, in the case of a written withdrawal. 3. Property location. In these columns you will enter the applicable codes for the MSA, state, county, and census-tract locations for the property to which a loan relates. (See paragraph e. below for treatment of loans on property outside the MSAs in which you have offices.) Regulation C a. MSA. For each loan or loan applica tion, indicate the location of the property by the MSA number. Enter only the MSA number, not the MSA name. MSA boundaries are defined by the U.S. Office of Management and Budget; use the boundaries that were in effect on January 1 of the calendar year for which you are reporting. b. State and county. Use the two-digit numerical code for state and the threedigit numerical code for county available from your regional supervisory agency. Use only these established codes. Do not use the abbreviations used by the U.S. Postal Service. c. Census tract. Indicate the census tract in which the property is located. i. Enter the code “NA” if the property is located in an area not divided into census tracts on the U.S. Census Bu reau’s census-tract outline maps (see paragraph d. below). ii. If the property is located in a coun ty with a population of 30,000 or less in the 1980 census, enter “NA” or en ter the census-tract number. To deter mine population, use the Census Bu reau’s PC80-1-A population series even if the population has increased above 30,000 since 1980. d. Census-tract number. To determine the census-tract number, consult the U.S. Census Bureau’s census-tract outline maps. You must use the maps from the Census Bureau’s PHC80-2 series for the 1980 census, or equivalent 1980 census data from the Census Bureau (such as G BF/D IM E files) or from a private pub lisher. You will continue to use the maps in the 1980 series until you are advised differently by your supervisory agency, even if more current maps are available. e. Outside MSA. For loans on property located outside the MSAs in which you have a home or branch office (or outside any MSA), you may either enter the code “NA” in the MSA, state, county, and census-tract columns or enter the data. Keep in mind that if your are a forprofit mortgage-lending institution (oth er than a bank, savings association, or Regulation C credit union) and (1) you received five or more loan applications or (2) origi nated or purchased five or more homepurchase or home-improvement loans in an MSA in the preceding year, you must complete these columns because you are considered to have a branch office in that MSA, whether or not you have a physical office there. 4. Race or national origin, sex, and income. Appendix B of Regulation C contains in structions for the collection of data on race or national origin and sex, and also contains a sample form for data collection. You may also use the form that you use to obtain data on race or national origin and sex un der section 202.13 of Regulation B. a. Applicability. You must report this in formation concerning applicants for loans that you originate and applications that you receive. i. You need not collect or report this information for loans purchased; if you choose not to, enter the appropriate code specified in the lists under para graphs c., d., and e. below for “not applicable.” ii. If your institution is a bank, savings association, or credit union that had assets of $30 million or less on the pre ceding December 31, you may—but need not—collect and report these data. If you choose not to, enter the appropriate codes specified in the lists under paragraphs c., d., and e. below for “not applicable.” iii. If the borrower or applicant is not a natural person (a corporation or partnership, for example), use the ap propriate code under paragraphs c., d., and e. below for “not applicable.” b. Telephone and mail applications. Any application forms mailed to applicants must contain a collection form similar to that shown in appendix B, and you must record the data on race or national origin and sex if the applicant provides it. If the applicant chooses not to provide the data, enter the applicable code number for “information not provided by appli Appendix A cant in mail or telephone application” under paragraphs c. and d. below. c. Race or national origin o f borrower or applicant. Use the following codes to in dicate the race or national origin of the applicant or borrower under column “A” and of any co-applicant or co-borrower under column “CA.” If there is more than one co-applicant, provide this infor mation only for the first co-applicant list ed on the application form. 1—American Indian or Alaskan Native 2—Asian or Pacific Islander 3—Black 4 —Hispanic 5—White 6—Other 7—Information not provided by appli cant in mail or telephone application 8—Not applicable d. Sex o f borrower or applicant. Use the following codes to indicate the sex of the applicant or borrower under column “A” and of any co-applicant or co-borrower under column “CA.” If there is more than one co-applicant, provide this infor mation only for the first co-applicant list ed on the application form: 1—Male 2—Female 3—Information not provided by appli cant in mail or telephone application 4 —Not applicable e. Income. Enter the income that your institution relied upon in making the credit decision. i. Round all dollar amounts to the nearest thousand (round $500 up to the next $1,000), and show in terms of thousands. For example, $35,550 should be reported as 36. ii. For loans on multifamily dwellings, enter “NA.” iii. If no income is asked for or relied on in the credit decision (such as in “no income verification” type loans), enter “NA.” 5. Type o f purchaser. For loans originated or purchased and then sold within the same 9 Appendix A Regulation C If your institution uses the model form for adverse action supplied in the appendix to Regulation B (Form C-1 in appendix C, 0—Loan was not sold in calendar year cov Sample Notification Form, which offers ered by register some 20 reasons for denial), the following 1—FNMA (Federal National Mortgage list shows which codes to use. Association) a. Use code 1 for: Income insufficient for 2—GNMA (Government National Mort amount of credit requested, and Exces gage Association) sive obligations in relation to income. 3—FHLMC (Federal Home Loan Mort b. Use code 2 for: Temporary or irregu gage Corporation) lar employment, and Length of 4 —FmHA (Farmers Home employment. Administration) c. Use code 3 for: Insufficient number of 5—Commercial bank credit references provided; Unacceptable 6—Savings bank or savings association type of credit references provided; No 7—Life insurance company credit file; Limited credit experience; 8—Affiliate institution Poor credit performance with us; Delin 9—Other type of purchaser quent past or present credit obligations with others; Garnishment, attachment, a. If you originated or purchased a loan foreclosure, repossession, collection ac and did not sell the loan that same calen tion, or judgment; and Bankruptcy. dar year, enter code 0. d. Use code 4 for: Value or type of col b. If you sell a loan in a succeeding year, lateral not sufficient. you need not report the sale. e. Use code 6 for: Unable to verify credit c. If you conditionally assign a loan to references, Unable to verify employment, GNMA in connection with a mortgageUnable to verify income, and Unable to backed security transaction, use code 2. verify residence. d. Loans “swapped” for mortgagef. Use code 7 for: Credit application backed securities are to be treated as incomplete. sales; enter the type of entity receiving g. Use code 9 for: Length of residence, the loans that are swapped as the Temporary residence, and Other. purchaser. e. Use code 8 for loans sold in the same III. Federal Supervisory Agencies year to an institution affiliated with you, such as a subsidiary or a parent Send your loan/application register and direct any questions to the office of your federal su corporation. pervisory agency specified below. If you are 6. Reasons fo r denial. You need not enter the subsidiary of a bank, savings association, the reasons for the denial of an application. or credit union, send the register to the super But if you wish to do so, you may indicate visory agency for your parent institution. up to three reasons by using the following National banks and their subsidiaries. District codes: office of the Office of the Comptroller of the Currency serving the district in which the na 1—Debt-to-income ratio tional bank or subsidiary is located. 2—Employment history 3—Credit history State member banks o f the Federal Reserve 4 —Collateral System, their subsidiaries, and subsidiaries o f 5—Insufficient cash (downpayment, clos bank holding companies. Federal Reserve ing costs) Bank serving the district in which the state 6—Unverifiable information member bank or subsidiary is located. 7—Credit application incomplete Nonmember insured banks (except fo r federal 8—Mortgage insurance denied savings banks) and their subsidiaries. Regional 9—Other calendar year, enter the applicable code to indicate the secondary market entity: 10 Regulation C director of the Federal Deposit Insurance Corporation for the region in which the bank or subsidiary is located. Savings institutions insured under the Savings Association Insurance Fund o f the FDIC; fed erally chartered savings banks insured under the Bank Insurance Fund o f the FDIC (but not including state-chartered savings banks in sured under the Bank Insurance Fund), their subsidiaries, and subsidiaries o f savings institu tion holding companies. To the district or oth er office specified by the Office of Thrift Supervision. Appendix A Credit unions. National Credit Union Admin istration, Office of Examination and Insur ance, 1776 G Street, N.W., Washington, D.C. 20456. Other depository institutions. Regional direc tor of the Federal Deposit Insurance Corpora tion for the region in which the institution is located. Other mortgage lending institutions. Assistant Secretary for Housing, HMDA Reporting— Room 9233, U.S. Department of Housing and Urban Development, 451 7th Street, S.W., Washington, D.C. 20410. Appendix A Regulation C Form FR HMOA-LAR OMB No. 71000247. Approval expires December 31, 1862 Hour* per response: 10-750 (120 average) This report Is required by law (12 USC 2801-2810 and 12 CFR 203) LOAN/APPLICATION REGISTER Control Number (agency use only) TRANSMITTAL SHEET You must complete this trsnsmlttsl sheet (pleese type or print) and attach It to the Loan/Application Register, required by the Home Mortgage Disclosure Act, that you submit to your supervisory agency. The Loan/Application Register that is attached covers activity during 19___and contains a tota l o f ___ pages. Enter the name and adress o f your in stitutio n. The disclosure statem ent th a t is produced by the Federal Financial Institu tion s Examination Council w ill be mailed to the address you supply below: Name Address City, State, ZIP Enter the name and telephone number of a person who may be contacted if questions arise regarding your report: Name Telephone Number If your in stitutio n is a subsidiary of another in stitutio n or corporation, enter the name of your parent: Name Address City, State, ZIP Enter the name and address of your supervisory agency: Name Address City, State, ZIP An o ffice r of your in stitutio n must complete the follow ing section. I certify to the accuracy of this report. Name of O fficer 12 Signature Date Appendix A Loan/Application Register Use the following codes to complete the loan/ application register. The instructions explain the proper use of each code. Application or Loan Information Type: 1—Conventional (any loan other than FHA, VA or FmHA loans) 2—FHA-insured (Federal Housing Administration) 3—VA-guaranteed (Veterans Admin istration) 4—FmHA-insured (Farmers Home Administration) Purpose: 1—Home purchase (one- to four-family) 2—Home improvement (one- to fourfamily) 3—Refinancing (home purchase, one- to four-family) 4—Multifamily dwelling (home purchase, home improvement, and refinancings) Occupancy: 1—Owner-occupied as a principal dwelling 2—Not owner-occupied 3—Not applicable Action Taken: 1—Loan originated 2—Application approved but not accepted by applicant 3—Application denied 4—Application withdrawn 5—File closed for incompleteness 6—Loan purchased by your institution Applicant Information Race or National Origin: 1—American Indian or Alaskan Native 2—Asian or Pacific Islander Regulation C 3—Black 4—Hispanic 5—White 6—Other 7—Information not provided by applicant in mail or telephone application 8—Not applicable Sex: 1—Male 2—Female 3—Information not provided by applicant in mail or telephone application 4—Not applicable Type o f Purchaser 0—Loan was not sold in calendar year cov ered by register 1—FNMA (Federal National Mortgage Association) 2—GNMA (Government National Mort gage Association) 3—FHLMC (Federal Home Loan Mort gage Corporation) 4—FmHA (Farmers Home Admini stration) 5—Commercial bank 6—Savings bank or savings association 7—Life insurance company 8—Affiliate institution 9—Other type of purchaser Reasons fo r Denial 1—Debt-to-income ratio 2—Employment history 3—Credit history 4—Collateral 5—Insufficient cash (downpayment, clos ing costs) 6—Unverifiable information 7—Credit application incomplete 8—Mortgage insurance denied 9—Other Appendix B Regulation C APPENDIX B— Form and Instructions for Data Collection on Race or National Origin and Sex Sample Data-Collection Form I. Instructions on Collection o f Data on Race or National Origin and Sex The following information is requested by the federal government for certain types of loans related to a dwelling in order to monitor the lender’s compliance with equal credit oppor tunity, fair housing, and home mortgage dis closure laws. You are not required to furnish this information, but are encouraged to do so. The law provides that a lender may not dis criminate on the basis of this information, or on whether you choose to furnish it. However, if you choose not to furnish the information and you have made this application in person, under federal regulations the lender is re quired to note race or national origin and sex on the basis of visual observation or surname. If you do not wish to furnish the information, please check below. A. Format. You may list questions regarding the race or national origin and sex of the ap plicant on your loan application form, or on a separate form that refers to the application. (See the sample form below for recommended language.) B. Procedures. 1. You must ask for this information, but cannot require the applicant to provide it. 2. If the applicant chooses not to provide the information for an application taken in person, note this fact on the form and note the data, to the extent possible, on the basis of visual observation or surname. 3. Inform the applicant that the federal government is requesting this information in order to monitor compliance with federal statutes that prohibit lenders from discrimi nating against applicants on these bases. In form the applicant that if the information is not provided where the application is taken in person, you are required to note the data on the basis of visual observation or surname. 4. If an application is made entirely by tele phone, you need not request this informa tion. And you need not provide the data when you take an application by mail, if the applicant fails to answer these questions on the application form. You should indicate whether an application was received by mail or telephone, if it is not otherwise evi dent on the face of the application. 5. The “other” block is available only to the applicant who chooses to indicate some other appropriate category for race or na tional origin. If completing the form based on visual observation, do not use this cate gory; use one of the other five categories. INFORMATION FOR GOVERNMENT M ONITORING PURPOSES APPLICANT: | I do not wish to furnish this information. Race or National Origin: ] American Indian, Alaskan Native ] Asian, Pacific Islander I | Black ] Hispanic □ White ] Other (specify) -----------------------------Sex: | | Female I | Male CO-APPLICANT: □ I do not wish to furnish this information. Race or National Origin: □ American Indian, Alaskan Native j Asian, Pacific Islander Q] Black |~1 Hispanic □ White □ Other (specify) -----------------------------Sex: | | Female Q Male Home Mortgage Disclosure Act 12 USC 2801 et seq.; 89 Stat. 1125; Pub. L. 94-200, Title III (Decem ber 31, 1975) TITLE III—HOME MORTGAGE DISCLOSURE Section 301 Short title 302 Findings and purposes 303 Definitions 304 Maintenance of records and public disclosure 305 Enforcement 306 Relation to state laws 307 Research and improved methods 308 Study 309 Effective date 310 Compilation of aggregate data 311 Disclosure by the secretary SECTION 301—Short Title This title may be cited as the “Home Mort gage Disclosure Act of 1975.” [12 USC 2801 note.] SECTION 302— Findings and Purposes (a) The Congress finds that some depository institutions have sometimes contributed to the decline of certain geographic areas by their failure pursuant to their chartering responsi bilities to provide adequate home financing to qualified applicants on reasonable terms and conditions. (b) The purpose of this title is to provide the citizens and public officials of the United States with sufficient information to enable them to determine whether depository institu tions are filling their obligations to serve the housing needs of the communities and neigh borhoods in which they are located and to as sist public officials in their determination of the distribution of public sector investments in a manner designed to improve the private in vestment environment. (c) Nothing in this title is intended to, nor shall it be construed to, encourage unsound lending practices or the allocation of credit. [12 USC 2801.] SECTION 303—Definitions For purposes of this title— (1) the term “mortgage loan” means a loan which is secured by residential real property or a home improvement loan; (2) the term “depository institution”— (A ) means— (i) any bank (as defined in section 3 (a)(1 ) of the Federal Deposit Insur ance Act); (ii) any savings association (as de fined in section 3(b)(1) of the Federal Deposit Insurance Act); and (iii) any credit union, which makes federally related mortgage loans as determined by the Board; and (B) includes any other lending institu tion (as defined in paragraph (4 )) other than any institution described in subpara graph (A ); (3) the term “completed application” means an application in which the creditor has received the information that is regular ly obtained in evaluating applications for the amount and type of credit requested; (4) the term “other lending institutions” means any person engaged for profit in the business of mortgage lending; (5) the term “Board” means the Board of Governors of the Federal Reserve System; and (6) the term “Secretary” means the Secre tary of Housing and Urban Development. [12 USC 2802. As amended by acts o f Feb. 5, 1988 (101 Stat. 1945) and Aug. 9, 1989 (103 Stat. 525).] SECTION 304— Maintenance of Records and Public Disclosure (a) (1) Each depository institution which has a home office or branch office located with in a primary metropolitan statistical area, metropolitan statistical area, or consolidat ed metropolitan statistical area that is not comprised of designated primary metropoli tan statistical areas, as defined by the De partment of Commerce shall compile and 17 §304 make available, in accordance with regula tions of the Board, to the public for in spection and copying at the home office, and at least one branch office within each primary metropolitan statistical area, met ropolitan statistical area, or consolidated metropolitan statistical area that is not comprised of designated primary metropoli tan statistical areas in which the depository institution has an office the number and to tal dollar amount of mortgage loans which were (A) originated (or for which the insti tution received completed applications), or (B) purchased by that institution during each fiscal year (beginning with the last full fiscal year of that institution which immedi ately preceded the effective date of this title.) (2) The information required to be main tained and made available under paragraph (1) shall also be itemized in order to clearly and conspicuously disclose the following: (A) The number and dollar amount for each item referred to in paragraph (1), by census tracts for mortgage loans se cured by property located within any county with a population of more than 30,000, within that primary metropolitan statistical area, metropolitan statistical area, or consolidated metropolitan statis tical area that is not comprised of desig nated primary metropolitan statistical ar eas, otherwise, by county, for mortgage loans secured by property located within any other county within that primary met ropolitan statistical area, metropolitan statistical area, or consolidated metropol itan statistical area that is not comprised of designated primary metropolitan sta tistical areas. (B) The number and dollar amount for each item referred to in paragraph (1) for all such mortgage loans which are se cured by property located outside that primary metropolitan statistical area, metropolitan statistical area, or consoli dated metropolitan statistical area that is not comprised of designated primary metropolitan statistical areas. For the purpose of this paragraph, a deposi tory institution which maintains offices in more than one primary metropolitan statis 18 Home Mortgage Disclosure Act tical area, metropolitan statistical area, or consolidated metropolitan statistical area that is not comprised of designated primary metropolitan statistical areas shall be re quired to make the information required by this paragraph available at any such office only to the extent that such information relates to mortgage loans which were originated or purchased (or for which com pleted applications were received) by an of fice of that depository institution located in the primary metropolitan statistical area, metropolitan statistical area, or consolidat ed metropolitan statistical area that is not comprised of designated primary metropoli tan statistical areas in which the office mak ing such information available is located. For purposes of this paragraph, other lend ing institutions shall be deemed to have a home office or branch office within a pri mary metropolitan statistical area, metro politan statistical area, or consolidated met ropolitan statistical area that is not com prised of designated primary metropolitan statistical areas if such institutions have originated or purchased or received com pleted applications for at least 5 mortgage loans in such area in the preceding calendar year. (b) Any item of information relating to mortgage loans required to be maintained un der subsection (a) shall be further itemized in order to disclose for each such item— (1) the number and dollar amount of mortgage loans which are insured under ti tle II of the National Housing Act or under title V of the Housing Act of 1949 or which are guaranteed under chapter 37 of title 38, United States Code; (2) the number and dollar amount of mortgage loans made to mortgagors who did not, at the time of execution of the mortgage, intend to reside in the property securing the mortgage loan; (3) the number and dollar amount of home improvement loans; and (4) the number and dollar amount of mort gage loans and completed applications in volving mortgagors or mortgage applicants grouped according to census tract, income level, racial characteristics, and gender. Home Mortgage Disclosure Act (c) Any information required to be compiled and made available under this section shall be maintained and made available for a period of five years after the close of the first year dur ing which such information is required to be maintained and made available. (d) Notwithstanding the provisions of sub section (a)(1 ), data required to be disclosed under this section for 1980 and thereafter shall be disclosed for each calendar year. Any depository institution which is required to make disclosures under this section but which has been making disclosures on some basis other than a calendar year basis shall make available a separate disclosure statement con taining data for any period prior to calendar year 1980 which is not covered by the last full year report prior to the 1980 calendar year report. (e) Subject to subsection (L ), the Board shall prescribe a standard format for the dis closures required under this section. (f) The Federal Financial Institutions Exam ination Council in consultation with the Sec retary, shall implement a system to facilitate access to data required to be disclosed under this section. Such system shall include ar rangements for a central depository of data in each primary metropolitan statistical area, metropolitan statistical area, or consolidated metropolitan statistical area that is not com prised of designated primary metropolitan sta tistical areas. Disclosure statements shall be made available to the public for inspection and copying at such central depository of data for all depository institutions which are re quired to disclose information under this sec tion (or which are exempted pursuant to sec tion 306(b)) and which have a home office or branch office within such primary metropoli tan statistical area, metropolitan statistical area, or consolidated metropolitan statistical area that is not comprised of designated pri mary metropolitan statistical areas. (g) The requirements of subsections (a) and (b) shall not apply with respect to mortgage loans that are— (1) made (or for which completed applica tions are received) by any mortgage bank ing subsidiary of a bank holding company §304 or savings and loan holding company or by any savings and loan service corporation that originates or purchases mortgage loans; and (2) approved (or for which completed ap plications are received) by the secretary for insurance under title I or II of the National Housing Act. (h) The data required to be disclosed under subsection (b)(4 ) shall be submitted to the appropriate agency for each institution report ing under this title. Notwithstanding the re quirement of section 304(a) (2) (A) for disclo sure by census tract, the Board, in cooperation with other appropriate regulators, including— (1) the Comptroller of the Currency for national banks; (2) the Director of the Office of Thrift Su pervision for savings associations; (3) the Federal Deposit Insurance Corpo ration for banks insured by the Federal De posit Insurance Corporation (other than members of the Federal Reserve System), mutual savings banks, and any other depos itory institution described in section 303(2) (A) which is not otherwise referred to in this paragraph; (4) the National Credit Union Adminis tration Board for credit unions; and (5) the Secretary of Housing and Urban Development for other lending institutions not regulated by the agencies referred to in paragraphs (1) through (4), shall develop regulations prescribing the for mat for such disclosures, the method for sub mission of the data to the appropriate regula tory agency, and the procedures for disclosing the information to the public. These regula tions shall also require the collection of data required to be disclosed under subsection (b) (4) with respect to loans sold by each in stitution reporting under this title, and, in ad dition, shall require disclosure of the class of the purchaser of such loans. Any reporting in stitution may submit in writing to the appro priate agency such additional data or explana tions as it deems relevant to the decision to originate or purchase mortgage loans. (i) The requirements of subsection (b)(4) shall not apply with respect to any depository institution described in section 303 (2) (A) 19 §304 which has total assets, as of the most recent full fiscal year of such institution, of $30,000,000 or less. [12 USC 2803. As amended by acts o f Oct. 8, 1980 (94 Stat. 1657); Nov. 30, 1983 (97 Stat. 1266); Feb. 5, 1988 (101 Stat. 1945, 1950); and Aug. 9, 1989 (103 Stat. 524, 525, 526).] SE C T IO N 305— Enforcem ent (a) The Board shall prescribe such regula tions as may be necessary to carry out the purposes of this title. These regulations may contain such classifications, differentiations, or other provisions, and may provide for such adjustments and exceptions for any class of transactions, as in the judgment of the Board are necessary and proper to effectuate the pur poses of this title, and prevent circumvention or evasion thereof, or to facilitate compliance therewith. (b) Compliance with the requirements im posed under this title shall be enforced un der— (1) section 8 of the Federal Deposit Insur ance Act, in the case of— (A ) national banks, by the Comptroller of the Currency; (B) member banks of the Federal Re serve System, other than national banks, by the Board; (C) banks insured by the Federal Depo sit Insurance Corporation (other than members of the Federal Reserve System) and mutual savings banks as defined in section 3(f) of the Federal Deposit In surance Act (12 U.S.C. 1813(f)) and any other depository institution not re ferred to in this paragraph or paragraph (2) or (3) of this subsection, by the Board of Directors of the Federal Depo sit Insurance Corporation; (2) section 8 of the Federal Deposit Insur ance Act, by the Director of the Office of Thrift Supervision, in the case of a savings association the deposits of which are in sured by the Federal Deposit Insurance Corporation; (3) the Federal Credit Union Act, by the Administrator of the National Credit Un 20 Home Mortgage Disclosure Act ion Administration with respect to any credit union; and (4) other lending institutions, by the Sec retary of Housing and Urban Development. (c) For the purpose of the exercise by any agency referred to in subsection (b) of its powers under any Act referred to in that sub section, a violation of any requirement im posed under this title shall be deemed to be a violation of a requirement imposed under that Act. In addition to its powers under any pro vision of law specifically referred to in subsec tion (b), each of the agencies referred to in that subsection may exercise, for the purpose of enforcing compliance with any requirement imposed under this title, any other authority conferred on it by law. [12 USC 2804. As amended by act o f Aug. 9, 1989 (103 Stat. 440, 526).] SE C T IO N 306— R elation to State Laws (a) This title does not annul, alter, or affect, or exempt any State-chartered depository in stitution subject to the provisions of this title from complying with the laws of any state or subdivision thereof with respect to public dis closure and recordkeeping by depository insti tutions, except to the extent that those laws are inconsistent with any provision of this ti tle, and then only to the extent of the incon sistency. The Board is authorized to deter mine whether such inconsistencies exist. The Board may not determine that any such law is inconsistent with any provision of this title if the Board determines that such law requires the maintenance of records with greater geo graphic or other detail than is required under this title, or that such law otherwise provides greater disclosure than is required under this title. (b) The Board may by regulation exempt from the requirements of this title any statechartered depository institution within any state or subdivision thereof if it determines that, under the law of such state or subdivi sion, that institution is subject to requirements substantially similar to those imposed under this title, and that such law contains adequate provisions for enforcement. Notwithstanding §310 Home Mortgage Disclosure Act any other provision of this subsection, compli ance with the requirements imposed under this subsection shall be enforced under— (1) section 8 of the Federal Deposit Insur ance Act in the case of national banks, by the Comptroller of the Currency; and (2) section 8 of the Federal Deposit Insur ance Act, by the Director of the Office of Thrift Supervision in the case of a savings association the deposits of which are in sured by the Federal Deposit Insurance Corporation. [12 USC 2806. As amended by H. Res. 5 of Jan. 4, 1977 and acts of Nov. 7, 1988 (102 Stat. 3280) and Aug. 9, 1989 (103 Stat. 440).] SE C T IO N 308— Study The Board, in consultation with the Secretary of Housing and Urban Development, shall re port annually to the Congress on the utility of the requirements of section 304(b)(4). [12 USC 2807. As amended by acts of Nov. 30, 1983 (97 Stat. 1266) and Aug. 9, 1989 (103 Stat. 526).] [12 USC 2805. As amended by act o f Aug. 9, 1989 (103 Stat. 440).] SE C T IO N 309— Effective D ate SE C T IO N 307— Research and Im proved M ethods (a )(1 ) The Director of the Office of Thrift Supervision, with the assistance of the Sec retary, the Director of the Bureau of the Census, the Comptroller of the Currency, the Board of Governors of the Federal Re serve System, the Federal Deposit Insur ance Corporation, and such other persons as the Director of the Office of Thrift Su pervision deems appropriate, shall develop, or assist in the improvement of, methods of matching addresses and census tracts to fa cilitate compliance by depository institu tions in as economical a manner as possible with the requirements of this title. (2) There is authorized to be appropriated such sums as may be necessary to carry out this subsection. (3) The Director of the Office of Thrift Su pervision is authorized to utilize, contract with, act through, or compensate any per son or agency in order to carry out this subsection. This title shall take effect on the one hundred and eightieth day beginning after the date of its enactment. Any depository institution which has total assets as of its last full fiscal year of $10,000,000 or less is exempt from the provisions of this title. [12 USC 2808.] SE C T IO N 310— C om pilation of A ggregate D ata (a) Beginning with data for calendar year 1980, the Federal Financial Institutions Ex amination Council shall compile each year, for each primary metropolitan statistical area, metropolitan statistical area, or consolidated metropolitan statistical area that is not com prised of designated primary metropolitan sta tistical areas, aggregate data by census tract for all depository institutions which are re quired to disclose data under section 304 or which are exempt pursuant to section 306(b). The Council shall also produce tables indicat ing, for each primary metropolitan statistical area, metropolitan statistical area, or consoli (b) The Director of the Office of Thrift Su dated metropolitan statistical area that is not pervision shall recommend to the Committee comprised of designated primary metropoli on Banking, Finance and Urban Affairs of the tan statistical areas, aggregate lending pat House of Representatives and the Committee terns for various categories of census tracts on Banking, Housing, and Urban Affairs of grouped according to location, age of housing the Senate such additional legislation as the stock, income level, and racial characteristics. Director of the Office of Thrift Supervision deems appropriate to carry out the purpose of (b) The Board shall provide staff and data this title. processing resources to the Council to enable 21 §310 Home Mortgage Disclosure Act it to carry out the provisions of subsection (a). mation required to be made publicly available in accordance with section 310. (c) The data and tables required pursuant to subsection (a) shall be made available to the public by no later than December 31 of the year following the calendar year on which the data is based. [12 use 2810. As added by act of Oct. 8, 1980 (94 Stat. 1658) and amendedd by acts of Nov. 30, 1983 (97 Stat. 1266); Feb. 5, 1988 (101 Stat. 1945); and Aug. 9, 1989 (103 Stat. 525).] [12 USC 2809. As added by act o f Oct. 8, 1980 (94 Stat. 1658) and amended by act o f Nov. 30, 1983 (97 Stat. 1266).] PUBLIC LAW 96-399, TITLE III SECTION 340 SECTION 311— Disclosure by the Secretary Beginning with data for calendar year 1980, the Secretary shall make publicly available data in the Secretary’s possession for each mortgagee which is not otherwise subject to the requirements of this title and which is not exempt pursuant to section 306(b) (and for each mortgagee making mortgage loans ex empted under section 304(g)), with respect to mortgage loans approved (or for which com pleted applications are received) by the Secre tary for insurance under title I or II of the National Housing Act. Such data to be dis closed shall consist of data comparable to the data which would be disclosed if such mortga gee were subject to the requirements of section 304. Disclosure statements containing data for each such mortgage for a primary metropoli tan statistical area, metropolitan statistical area, or consolidated metropolitan statistical area that is not comprised of designated pri mary metropolitan statistical areas shall, at a minimum, be publicly available at the central depository of data established pursuant to sec tion 304(f) for such primary metropolitan statistical area, metropolitan statistical area, or consolidated metropolitan statistical area that is not comprised of designated primary metropolitan statistical areas. The Secretary shall also compile and make publicly available aggregate data for such mortgagees by census tract, and tables indicating aggregate lending patterns, in a manner comparable to the infor (d) The Federal Financial Institutions Ex amination Council, in consultation with the Administrator of the Small Business Adminis tration, shall conduct a study to assess the fea sibility and usefulness of requiring depository institutions which make small business loans to compile and publicly disclose information regarding such loans. The Council shall sub mit a report on the results of such study, to gether with recommendations, to the Commit tee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Banking, Finance and Urban Affairs of the House of Representatives not later than March 1, 1981. [12 USC 3305 note.] (e) To promote efficiency and avoid duplica tion to the maximum extent feasible, the Fed eral Financial Institutions Examination Coun cil shall transmit a report to the Congress not later than September 30, 1982, on the feasibili ty and desirability of establishing a unified system for enforcing fair lending laws and reg ulations, implementing the Community Rein vestment Act of 1977, and satisfying the pub lic disclosure purposes of the Home Mortgage Disclosure Act of 1975. Such report shall evaluate the status and effectiveness of data collection and analysis systems of such agen cies involving fair lending and community re investment, and shall outline possible specific timetables for implementing such a unified system. [12 USC 3305 note.]
@FedFRASER