12 CFR Part 1002 — Equal Credit Opportunity Act (Regulation B)

PART 1002—EQUAL CREDIT OPPORTUNITY ACT (REGULATION B) Authority: 12 U.S.C. 5512, 5581; 15 U.S.C. 1691b. Subpart B is also issued under 15 U.S.C. 1691c-2. Source: 76 FR 79445, Dec. 21, 2011, unless otherwise noted. Subpart A—General § 1002.1 Authority, scope and purpose. (a) Authority and scope. et seq. et seq. (b) Purpose. [76 FR 79445, Dec. 21, 2011, as amended at 88 FR 35527, May 31, 2023] § 1002.2 Definitions. For the purposes of this part, unless the context indicates otherwise or as otherwise defined in subpart B, the following definitions apply: (a) Account (b) Act (c) Adverse action. (i) A refusal to grant credit in substantially 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 account that does not affect all or substantially all of a class of the creditor's accounts; or (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 inactivity, default, or delinquency as to that account; (iii) A refusal or failure to authorize an account transaction at point of sale or loan, except when the refusal is a termination or an unfavorable change in the terms of an account that does not affect all or substantially all of a class of the creditor's accounts, or when the refusal 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 definition of both paragraphs (c)(1) and (c)(2) of this section is governed by paragraph (c)(2) of this section. (d) Age (e) Applicant (f) Application completed application (g) Business credit (h) Consumer credit (i) Contractually liable (j) Credit (k) Credit card (l) Creditor (m) Credit transaction (n) Discriminate against an applicant (o) Elderly (p) Empirically derived and other credit scoring systems A credit scoring system empirically derived, demonstrably and statistically sound, credit scoring system, (i) Based on data that are derived from an empirical comparison of sample groups or the population of creditworthy and non-creditworthy applicants who applied for credit within a reasonable preceding period of time; (ii) Developed for the purpose of evaluating the creditworthiness of applicants with respect to the legitimate business interests of the creditor utilizing the system (including, but not limited to, minimizing bad debt losses and operating expenses in accordance with the creditor's business judgment); (iii) Developed and validated using accepted statistical principles and methodology; 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 derived, demonstrably and statistically sound, credit scoring system obtained from another 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 during 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, demonstrably and statistically sound, credit scoring system for that creditor. (q) Extend credit extension of credit (r) Good faith (s) Inadvertent error (t) Judgmental system of evaluating applicants (u) Marital status (v) Negative factor or value, (w) Open-end credit (x) Person (y) Pertinent element of creditworthiness, (z) Prohibited basis (aa) State [76 FR 79445, Dec. 21, 2011, as amended at 88 FR 35527, May 31, 2023] § 1002.3 Limited exceptions for certain classes of transactions. (a) Public utilities credit Definition. (2) Exceptions. (i) Section 1002.5(d)(1) concerning information about marital status; and (ii) Section 1002.12(b) relating to record retention. (b) Securities credit Definition. (2) Exceptions. (i) Section 1002.5(b) concerning information about the sex of an applicant; (ii) Section 1002.5(c) concerning information about a spouse or former spouse; (iii) Section 1002.5(d)(1) concerning information about marital status; (iv) Section 1002.7(b) relating to designation of name to the extent necessary to comply with rules regarding an account in which a broker or dealer has an interest, or rules regarding the aggregation of accounts of spouses to determine controlling interests, beneficial interests, beneficial ownership, or purchase limitations and restrictions; (v) Section 1002.7(c) relating to action concerning open-end accounts, to the extent the action taken is on the basis of a change of name or marital status; (vi) Section 1002.7(d) relating to the signature of a spouse or other person; (vii) Section 1002.10 relating to furnishing of credit information; and (viii) Section 1002.12(b) relating to record retention. (c) Incidental credit Definition. (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 1026.4); and (iii) That are not payable by agreement in more than four installments. (2) Exceptions. (i) Section 1002.5(b) concerning information about the sex of an applicant, but only to the extent necessary for medical records or similar purposes; (ii) Section 1002.5(c) concerning information about a spouse or former spouse; (iii) Section 1002.5(d)(1) concerning information about marital status; (iv) Section 1002.5(d)(2) concerning information about income derived from alimony, child support, or separate maintenance payments; (v) Section 1002.7(d) relating to the signature of a spouse or other person; (vi) Section 1002.9 relating to notifications; (vii) Section 1002.10 relating to furnishing of credit information; and (viii) Section 1002.12(b) relating to record retention. (d) Government credit Definition. (2) Applicability of regulation. § 1002.4 General rules. (a) Discrimination. (b) Discouragement. (c) Written applications. (d) Form of disclosures General rule. (2) Disclosures in electronic form. et seq. (e) Foreign-language disclosures. [76 FR 79445, Dec. 21, 2011, as amended at 78 FR 7248, Jan. 31, 2013; 91 FR 21668, Apr. 22, 2026] § 1002.5 Rules concerning requests for information. (a) General rules Requests for information. (2) Required collection of information. (3) Special-purpose credit. (4) Other permissible collection of information. (i) A creditor that is a financial institution under 12 CFR 1003.2(g) may collect information regarding the ethnicity, race, and sex of an applicant for a closed-end mortgage loan that is an excluded transaction under 12 CFR 1003.3(c)(11) if it submits HMDA data concerning such closed-end mortgage loans and applications or if it submitted HMDA data concerning closed-end mortgage loans for any of the preceding five calendar years; (ii) A creditor that is a financial institution under 12 CFR 1003.2(g) may collect information regarding the ethnicity, race, and sex of an applicant for an open-end line of credit that is an excluded transaction under 12 CFR 1003.3(c)(12) if it submits HMDA data concerning such open-end lines of credit and applications or if it submitted HMDA data concerning open-end lines of credit for any of the preceding five calendar years; (iii) A creditor that submitted HMDA data for any of the preceding five calendar years but is not currently a financial institution under 12 CFR 1003.2(g) may collect information regarding the ethnicity, race, and sex of an applicant for a loan that would otherwise be a covered loan under 12 CFR 1003.2(e) if not excluded by 12 CFR 1003.3(c)(11) or (12); (iv) A creditor that exceeded an applicable loan volume threshold in the first year of the two-year threshold period provided in 12 CFR 1003.2(g), 1003.3(c)(11), or 1003.3(c)(12) may, in the second year, collect information regarding the ethnicity, race, and sex of an applicant for a loan that would otherwise be a covered loan under 12 CFR 1003.2(e) if the loan were not excluded by 12 CFR 1003.3(c)(11) or (12); (v) A creditor that is a financial institution under 12 CFR 1003.2(g), or that submitted HMDA data for any of the preceding five calendar years but is not currently a financial institution under 12 CFR 1003.2(g), may collect information regarding the ethnicity, race, and sex of an applicant for a loan that would otherwise be a covered loan under 12 CFR 1003.2(e) if the loan were not excluded by 12 CFR 1003.3(c)(10). (vi) A creditor that is collecting information regarding the ethnicity, race, and sex of an applicant or first co-applicant may collect information regarding the ethnicity, race, and sex of a second or additional co-applicant for a covered loan under 12 CFR 1003.2(e) or for a second or additional co-applicant for a loan described in paragraphs (a)(4)(i) through (v) of this section. (vii) A creditor that was required to report small business lending data pursuant to § 1002.109 for any of the preceding five calendar years but is not currently a covered financial institution under § 1002.105(b) may collect information pursuant to subpart B of this part for covered applications from small businesses as defined in §§ 1002.103 and 1002.106(b) regarding whether an applicant is a minority-owned business or a women-owned business, and the ethnicity, race, and sex of the applicant's principal owners if it complies with the requirements for covered financial institutions pursuant to §§ 1002.107(a)(18) and (19), 1002.108, 1002.111, and 1002.112 for that application. Such a creditor is permitted, but not required, to report data to the Bureau collected pursuant to subpart B of this part if it complies with the requirements of subpart B as otherwise required for covered financial institutions pursuant to §§ 1002.109 and 1002.110. (viii) A creditor that exceeded the loan-volume threshold in the first year of the two-year threshold period provided in § 1002.105(b) may, in the second year, collect information pursuant to subpart B of this part for covered applications from small businesses as defined in §§ 1002.103 and 1002.106(b) regarding whether an applicant is a minority-owned business or a women-owned business, and the ethnicity, race, and sex of the applicant's principal owners if it complies with the requirements for covered financial institutions pursuant to §§ 1002.107(a)(18) and (19), 1002.108, 1002.111, and 1002.112 for that application. Such a creditor is permitted, but not required, to report data to the Bureau collected pursuant to subpart B of this part if it complies with the requirements of subpart B as otherwise required for covered financial institutions pursuant to §§ 1002.109 and 1002.110. (ix) A creditor that is not currently a covered financial institution under § 1002.105(b), and is not otherwise a creditor to which paragraph (a)(4)(vii) or (viii) of this section applies, may collect information pursuant to subpart B of this part for covered applications from small businesses as defined in §§ 1002.103 and 1002.106(b) regarding whether an applicant for a covered credit transaction is a minority-owned business or a women-owned business, and the ethnicity, race, and sex of the applicant's principal owners for a transaction if it complies with the requirements for covered financial institutions pursuant to §§ 1002.107 through 1002.112 for that application. (x) A creditor that is collecting information pursuant to subpart B of this part or as described in paragraphs (a)(4)(vii) through (ix) of this section for covered applications from small businesses as defined in §§ 1002.103 and 1002.106(b) regarding whether an applicant for a covered credit transaction is a minority-owned business or a women-owned business, and the ethnicity, race, and sex of the applicant's principal owners may also collect that same information for any co-applicants provided that it also complies with the relevant requirements of subpart B of this part or as described in paragraphs (a)(4)(vii) through (ix) of this section with respect to those co-applicants. (b) Limitation on information about race, color, religion, national origin, or sex. (1) Self-test. (i) The applicant will not be required to provide the information; (ii) The creditor is requesting the information to monitor its compliance with the Federal Equal Credit Opportunity Act; (iii) Federal law prohibits the creditor from discriminating on the basis of this information, or on the basis of an applicant's decision not to furnish the information; and (iv) If applicable, certain information will be collected based on visual observation or surname if not provided by the applicant or other person. (2) Sex. (c) Information about a spouse or former spouse General rule. (2) Permissible inquiries. (i) The spouse will be permitted to use the account; (ii) The spouse will be contractually liable on the account; (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 community property state or is relying on property located in such a state as a basis for repayment of the credit requested; 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 of the applicant. (d) Other limitations on information requests Marital status. married, unmarried, separated. (2) Disclosure about income from alimony, child support, or separate maintenance. (3) Childbearing, childrearing. (e) Permanent residency and immigration status. [76 FR 79445, Dec. 21, 2011, as amended at 82 FR 45694, Oct. 2, 2017; 88 FR 35527, May 31, 2023; 91 FR 23604, May 1, 2026] § 1002.6 Rules concerning evaluation of applications. (a) General rule concerning use of information. (b) Specific rules concerning use of information. (2) Age, receipt of public assistance. (ii) In an empirically derived, demonstrably and statistically sound, credit scoring system, a creditor may use an applicant's age as a predictive variable, provided that the age of an elderly applicant is not assigned a negative factor or value. (iii) In a judgmental system of evaluating creditworthiness, a creditor may consider an applicant's age or whether an applicant'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 creditworthiness, 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. (4) Telephone listing. (5) Income. (6) Credit history. (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 information the applicant may present that tends to indicate the credit history being considered by the creditor does not accurately reflect the applicant's creditworthiness; and (iii) On the applicant's request, the credit history, when available, of any account reported in the name of the applicant's spouse or former spouse that the applicant can demonstrate accurately reflects the applicant's creditworthiness. (7) Immigration status. (8) Marital status. (9) Race, color, religion, national origin, sex. (c) State property laws. [76 FR 79445, Dec. 21, 2011, as amended at 91 FR 21668, Apr. 22, 2026] § 1002.7 Rules concerning extensions of credit. (a) Individual accounts. (b) Designation of name. (c) Action concerning existing open-end accounts Limitations. (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. (d) Signature of spouse or other person Rule for qualified applicant. (2) Unsecured credit. (3) Unsecured credit—community property states. (i) Applicable state law denies the applicant power to manage or control sufficient community property to qualify for the credit requested under the creditor's standards of creditworthiness; and (ii) The applicant does not have sufficient separate property to qualify for the credit requested without regard to community property. (4) Secured credit. (5) Additional parties. (6) Rights of additional parties. (e) Insurance. § 1002.8 Special purpose credit programs. (a) Standards for programs. (1) Any credit assistance program expressly 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 Revenue Code of 1954, as amended, for the benefit of its members or for the benefit of an economically disadvantaged class of persons; or (3) Any special purpose credit program offered by a for-profit organization, or in which such an organization participates to meet special social needs, if: (i) The program is established and administered pursuant to a written plan that: (A) Identifies the class of persons that the program is designed to benefit; (B) Sets forth the procedures and standards for extending credit pursuant to the program; (C) Provides evidence of the need for the program; (D) Explains why, under the organization's standards of creditworthiness, the class of persons would not receive such credit in the absence of the program; and (E) When the persons in the class are required to share one or more common characteristics that would otherwise be a prohibited basis, explains why meeting the special social needs addressed by the program: ( 1 ( 2 (ii) The program is established and administered to extend credit to a class of persons who, under the organization's standards of creditworthiness, would not receive such credit. (b) Controlling provisions General applicability. (2) Common characteristics. (3) Prohibited common characteristics. (4) Otherwise prohibited bases in for-profit programs. (c) Special rule concerning requests and use of information. (d) Special rule in the case of financial need. [76 FR 79445, Dec. 21, 2011, as amended at 91 FR 21668, Apr. 22, 2026] § 1002.9 Notifications. (a) Notification of action taken, ECOA notice, and statement of specific reasons When notification is required. (i) 30 days after receiving a completed application concerning the creditor's approval of, counteroffer to, or adverse action on the application; (ii) 30 days after taking adverse action on an incomplete application, unless notice is provided in accordance with paragraph (c) of this section; (iii) 30 days after taking adverse action on 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. (2) Content of notification when adverse action is taken. (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 notification. The disclosure shall include the name, address, and telephone number of the person or office from which the statement 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 the applicant's written request for confirmation. (3) Notification to business credit applicants. (i) With regard to a business that had gross revenues of $1 million or less in its preceding fiscal year (other than an extension 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) of this section, 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 contains the information required by paragraph (a)(2)(ii) of this section and the ECOA notice specified in paragraph (b)(1) of this section; (C) For an application made entirely by telephone, a creditor satisfies the requirements of paragraph (a)(3)(i) of this section 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 million in its preceding fiscal year or an extension of trade credit, credit incident to a factoring agreement, or other similar types of business credit, a creditor shall: (A) Notify the applicant, within a reasonable time, orally or in writing, 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 the creditor's notification. (b) Form of ECOA notice and statement of specific reasons ECOA notice. (2) Statement of specific reasons. (c) Incomplete applications Notice alternatives. (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 of incompleteness. (3) Oral request for information. (d) Oral notifications by small-volume creditors. (e) Withdrawal of approved application. (f) Multiple applicants. (g) Applications submitted through a third party. [76 FR 79445, Dec. 21, 2011, as amended at 88 FR 16537, Mar. 20, 2023] § 1002.10 Furnishing of credit information. (a) Designation of accounts. (1) Any new account to reflect the participation of both spouses if the applicant's spouse is permitted to use or is contractually liable on the account (other than as a guarantor, surety, endorser, or similar party); 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. (c) Reporting in response to inquiry. § 1002.11 Relation to state law. (a) Inconsistent state laws. (b) Preempted provisions of state law. (i) Requires or permits a practice or act prohibited by the Act or this part; (ii) Prohibits the individual extension of consumer credit to both parties to a marriage if each spouse individually and voluntarily applies for such credit; (iii) Prohibits inquiries or collection of data required to comply with the Act or this part; (iv) Prohibits asking about or considering age in an empirically derived, demonstrably and statistically sound, credit scoring system to determine a pertinent element of creditworthiness, or to favor an elderly applicant; or (v) Prohibits inquiries necessary to establish or administer a special purpose credit program as defined by § 1002.8. (2) A creditor, state, or other interested party may request that the Bureau determine whether a state law is inconsistent with the requirements of the Act and this part. (c) Laws on finance charges, loan ceilings. (d) State and Federal laws not affected. (e) Exemption for state-regulated transactions Applications. (i) The class of credit transactions is subject to state law requirements substantially similar to those of the Act and this part or that applicants are afforded greater protection under state law; and (ii) There is adequate provision for state enforcement. (2) Liability and enforcement. (ii) After an exemption has been granted, the requirements of the applicable state law (except for additional requirements not imposed by Federal law) will constitute the requirements of the Act and this part. § 1002.12 Record retention. (a) Retention of prohibited information. (1) From any source prior to March 23, 1977; (2) From consumer reporting agencies, an applicant, or others without the specific request of the creditor; or (3) As required to monitor compliance with the Act and this part or other Federal or state statutes or regulations. (b) Preservation of records Applications. (i) Any application that it receives, any information required to be obtained concerning characteristics of the applicant to monitor compliance with the Act and this part or other similar law, any information obtained pursuant to § 1002.5(a)(4), and any other written or recorded information used in evaluating the application and not returned to the applicant at the applicant'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 part. (2) Existing accounts. (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 part. (3) Other applications. (4) Enforcement proceedings and investigations. (5) Special rule for certain business credit applications. (6) Self-tests. (7) Prescreened solicitations. (i) The text of any prescreened solicitation; (ii) The list of criteria the creditor used to select potential recipients of the solicitation; and (iii) Any correspondence related to complaints (formal or informal) about the solicitation. [76 FR 79445, Dec. 21, 2011, as amended at 82 FR 45694, Oct. 2, 2017; 88 FR 35528, May 31, 2023] § 1002.13 Information for monitoring purposes. (a) Information to be requested. (i) Ethnicity and race using either: (A) For ethnicity, the aggregate categories Hispanic or Latino and not Hispanic or Latino; and, for race, the aggregate categories American Indian or Alaska Native, Asian, Black or African American, Native Hawaiian or Other Pacific Islander, and White; or (B) The categories and subcategories for the collection of ethnicity and race set forth in appendix B to 12 CFR part 1003. (ii) Sex; (iii) Marital status, using the categories married, unmarried, and separated; and (iv) Age. (2) Dwelling (b) Obtaining information. (c) Disclosure to applicant(s). (d) Substitute monitoring program. [76 FR 79445, Dec. 21, 2011, as amended at 82 FR 45694, Oct. 2, 2017] § 1002.14 Rules on providing appraisals and other valuations. (a) Providing appraisals and other valuations In general. (2) Disclosure. (3) Reimbursement. (4) Withdrawn, denied, or incomplete applications. (5) Copies in electronic form. et seq. (b) Definitions. (1) Consummation. (2) Dwelling. (3) Valuation. [78 FR 7248, Jan. 31, 2013] § 1002.15 Incentives for self-testing and self-correction. (a) General rules Voluntary self-testing and correction. (2) Corrective action required. (3) Other privileges. (b) Self-test defined Definition. (i) Is designed and used specifically to determine the extent or effectiveness of a creditor's compliance with the Act or this part; and (ii) Creates data or factual information that is not available and cannot be derived from loan or application files or other records related to credit transactions. (2) Types of information privileged. (3) Types of information not privileged. (i) Information about whether a creditor conducted a self-test, the methodology used or the scope of the self-test, the time period covered by the self-test, or the dates it was conducted; or (ii) Loan and application files or other business records related to credit transactions, and information derived from such files and records, even if the information has been aggregated, summarized, or reorganized to facilitate analysis. (c) Appropriate corrective action General requirement. (2) Determining the scope of appropriate corrective action. (i) Identifying the policies or practices that are the likely cause of the violation; and (ii) Assessing the extent and scope of any violation. (3) Types of relief. (i) A creditor is not required to provide remedial relief to a tester used in a self-test; (ii) A creditor is only required to provide remedial relief to an applicant identified by the self-test as one whose rights were more likely than not violated; and (iii) A creditor is not required to provide remedial relief to a particular applicant if the statute of limitations applicable to the violation expired before the creditor obtained the results of the self-test or the applicant is otherwise ineligible for such relief. (4) No admission of violation. (d) Scope of privilege General rule. (i) By a government agency in any examination or investigation relating to compliance with the Act or this part; or (ii) By a government agency or an applicant in any proceeding or civil action in which a violation of the Act or this part is alleged. (2) Loss of privilege. (i) Voluntarily discloses any part of the report or results, or any other information privileged under this section, to an applicant or government agency or to the public; (ii) Discloses any part of the report or results, or any other information privileged under this section, as a defense to charges that the creditor has violated the Act or regulation; or (iii) Fails or is unable to produce written or recorded information about the self-test that is required to be retained under § 1002.12(b)(6) when the information is needed to determine whether the privilege applies. This paragraph does not limit any other penalty or remedy that may be available for a violation of § 1002.12. (3) Limited use of privileged information. [76 FR 79445, Dec. 21, 2011, as amended at 91 FR 21668, Apr. 22, 2026] § 1002.16 Enforcement, penalties and liabilities. (a) Administrative enforcement. (2) Except to the extent that administrative enforcement is specifically assigned to some government agency other than the Bureau, and subject to subtitle B of the Consumer Financial Protection Act of 2010, the Federal Trade Commission is authorized to enforce the requirements imposed under the Act and this part. (b) Penalties and liabilities. (2) As provided in section 706(f) of the Act, a civil action under the Act or this part may be brought in the appropriate United States district court without regard to the amount in controversy or in any other court of competent jurisdiction within five years after the date of the occurrence of the violation, or within one year after the commencement of an administrative enforcement proceeding or of a civil action brought by the Attorney General of the United States within five years after the alleged violation. (3) If an agency responsible for administrative enforcement is unable to obtain compliance with the Act or this part, it may refer the matter to the Attorney General of the United States. If the Bureau, the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System, or the National Credit Union Administration has reason to believe that one or more creditors have engaged in a pattern or practice of discouraging or denying applications in violation of the Act or this part, the agency shall refer the matter to the Attorney General. If the agency has reason to believe that one or more creditors violated section 701(a) of the Act, the agency may refer a matter to the Attorney General. (4) On referral, or whenever the Attorney General has reason to believe that one or more creditors have engaged in a pattern or practice in violation of the Act or this part, the Attorney General may bring a civil action for such relief as may be appropriate, including actual and punitive damages and injunctive relief. (5) If the Comptroller of the Currency, the Federal Deposit Insurance Corporation, the Board of Governors of the Federal Reserve System, or the National Credit Union Administration has reason to believe (as a result of a consumer complaint, a consumer compliance examination, or some other basis) that a violation of the Act or this part has occurred which is also a violation of the Fair Housing Act, and the matter is not referred to the Attorney General, the agency shall: (i) Notify the Secretary of Housing and Urban Development; and (ii) Inform the applicant that the Secretary of Housing and Urban Development has been notified and that remedies may be available under the Fair Housing Act. (c) Failure of compliance. Subpart B—Small Business Lending Data Collection Source: 88 FR 35528, May 31, 2023, unless otherwise noted. § 1002.101 Authority, purpose, and scope. (a) Authority and scope. (b) Purpose. (1) To facilitate enforcement of fair lending laws; and (2) To enable communities, governmental entities, and creditors to identify business and community development needs and opportunities of women-owned, minority-owned, and small businesses. § 1002.102 Definitions. In this subpart: (a) Affiliate et seq. affiliate (b) Applicant (c) Business (d) Business credit (e) Closed-end credit transaction (f) Covered application (g) Covered credit transaction (h) Covered financial institution (i) Credit (j) Financial institution (k)-(l) [Reserved] (m) Minority-owned business (n) Open-end credit transaction (o) Principal owner (p) Small business (q) Small business lending application register register (r) State (s) Women-owned business [88 FR 35528, May 31, 2023, as amended at 91 FR 23605, May 1, 2026] § 1002.103 Covered applications. (a) Covered application. (b) Circumstances that are not covered applications. (1) Reevaluation, extension, or renewal requests on an existing business credit account, unless the request seeks additional credit amounts. (2) Inquiries and prequalification requests. § 1002.104 Covered credit transactions and excluded transactions. (a) Covered credit transaction (b) Excluded transactions. (1) Trade credit. (2) Home Mortgage Act (HMDA)-reportable transactions. (3) Insurance premium financing. (4) Public utilities credit. (5) Securities credit. (6) Incidental credit. (7) Merchant cash advance. (8) Agricultural lending. (9) Small dollar business credit. (ii) Every 5 years after January 1, 2030, the transaction amount set forth in this paragraph (b)(9) shall adjust based on changes to the Consumer Price Index for All Urban Consumers (U.S. city average series for all items, not seasonally adjusted), as published by the United States Bureau of Labor Statistics. Any adjustment that takes effect under this paragraph (b)(9)(ii) shall be rounded to the nearest multiple of $100. If an adjustment is to take effect, it will do so on January 1 of the following calendar year. [88 FR 35528, May 31, 2023, as amended at 91 FR 23605, May 1, 2026] § 1002.105 Covered financial institutions and exempt institutions. (a) Financial institution (b) Covered financial institution [88 FR 35528, May 31, 2023, as amended at 91 FR 23605, May 1, 2026] § 1002.106 Business and small business. (a) Business (b)(1) Small business (2) Every 5 years after January 1, 2030, the gross annual revenue threshold set forth in paragraph (b)(1) of this section shall adjust based on changes to the Consumer Price Index for All Urban Consumers (U.S. city average series for all items, not seasonally adjusted), as published by the United States Bureau of Labor Statistics. Any adjustment that takes effect under this paragraph (b)(2) shall be rounded to the nearest multiple of $100,000. If an adjustment is to take effect, it will do so on January 1 of the following calendar year. [88 FR 35528, May 31, 2023, as amended at 91 FR 23605, May 1, 2026] § 1002.107 Compilation of reportable data. (a) Data format and itemization. (1) Unique identifier. (2) Application date. (3)-(4) [Reserved] (5) Credit type. (i) Credit product. (ii) Guarantees. (iii) Loan term. (6) Credit purpose. (7) Amount applied for. (8) Amount approved or originated. (ii) For a closed-end credit transaction that is originated, the amount of credit originated; or (iii) For an application for an open-end credit transaction that is originated or approved but not accepted, the amount of the credit limit approved. (9) Action taken. (10) Action taken date. (11)-(12) [Reserved] (13) Census tract. (i) The address or location where the proceeds of the credit applied for or originated will be or would have been principally applied; or (ii) If the information in paragraph (a)(13)(i) of this section is unknown, the address or location of the main office or headquarters of the applicant; or (iii) If the information in both paragraphs (a)(13)(i) and (ii) of this section is unknown, another address or location associated with the applicant. (iv) The financial institution shall also indicate which one of the three types of addresses or locations listed in paragraphs (a)(13)(i), (ii), or (iii) of this section the census tract is based on. (14) Gross annual revenue. (15) NAICS code. (16) [Reserved] (17) Time in business. (18) Minority-owned and women-owned business statuses. (19) Ethnicity, race, and sex of principal owners. (20) Number of principal owners. (b) Reliance on and verification of applicant-provided data. (c) Time and manner of collection In general. (2) Applicant-provided data collected directly from the applicant. (i) The initial request for applicant-provided data occurs prior to notifying an applicant of final action taken on a covered application, or at another time reasonably designed to obtain a response; (ii) The request for applicant-provided data is prominently displayed or presented; and (iii) [Reserved] (iv) Applicants can easily respond to a request for applicant-provided data. (3)-(4) [Reserved] (d) Previously collected data. (1) To satisfy paragraphs (a)(13), (15), and (17) through (20) of this section, the data were collected within the 36 months preceding the current covered application, or to satisfy paragraph (a)(14) of this section, the data were collected within the same calendar year as the current covered application; and (2) The financial institution has no reason to believe the data are inaccurate. [88 FR 35528, May 31, 2023, as amended at 91 FR 23605, May 1, 2026] § 1002.108 Firewall. (a) Definitions. (1) Involved in making any determination concerning a covered application from a small business (2) Should have access (b) Prohibition on access to certain information. (c) Exception to the prohibition on access to certain information. (d) Notice. [88 FR 35528, May 31, 2023, as amended at 91 FR 23606, May 1, 2026] § 1002.109 Reporting of data to the Bureau. (a) Reporting to the Bureau Annual reporting. (ii) An authorized representative of the covered financial institution with knowledge of the data shall certify to the accuracy and completeness of the data reported pursuant to this paragraph (a). (iii) When the last day for submission of data prescribed under paragraph (a)(1) of this section falls on a Saturday or Sunday, a submission shall be considered timely if it is submitted on the next succeeding Monday. (2) Reporting by subsidiaries. (3) Reporting obligations where multiple financial institutions are involved in a covered credit transaction. (b) Financial institution identifying information. (1) Its name. (2) Its headquarters address. (3) The name and business contact information of a person that the Bureau or other regulators may contact about the financial institution's submission. (4) Its Federal prudential regulator, if applicable. (5) Its Federal Taxpayer Identification Number (TIN). (6) Its Legal Entity Identifier (LEI). (7) Its Research, Statistics, Supervision, and Discount identification (RSSD ID) number, if applicable. (8) Parent entity information, if applicable, including: (i) The name of the immediate parent entity; (ii) The LEI of the immediate parent entity, if available; (iii) The RSSD ID number of the immediate parent entity, if available; (iv) The name of the top-holding parent entity; (v) The LEI of the top-holding parent entity, if available; and (vi) The RSSD ID number of the top-holding parent entity, if available. (9) The type of financial institution that it is, indicated by selecting the appropriate type or types of institution from the list provided. (10) Whether the financial institution is voluntarily reporting covered applications from small businesses. (c) Procedures for the submission of data to the Bureau. https://www.consumerfinance.gov/data-research/small-business-lending/filing-instructions-guide/. § 1002.110 Publication of data and other disclosures. (a) Publication of small business lending application registers and associated financial institution information. (b) Publication of aggregate data. (c) Statement of financial institution's small business lending data available on the Bureau's website. (d) Availability of statements. (e) Further disclosure prohibited Disclosure by a financial institution. (2) Disclosure by a third party. § 1002.111 Recordkeeping. (a) Record retention. (b) Certain information kept separate from the rest of the application. (c) Limitation on personally identifiable information in certain records retained under this section. [88 FR 35528, May 31, 2023, as amended at 91 FR 23606, May 1, 2026] § 1002.112 Enforcement. (a) Administrative enforcement and civil liability. (b) Bona fide errors. (c) Safe harbors Incorrect entry for application date. (2) Incorrect entry for census tract. (3) Incorrect entry for NAICS code. (i) Relying on an applicant's representations or on an appropriate third-party source, in accordance with § 1002.107(b), regarding the NAICS code; or (ii) Identifying the NAICS code itself, provided that the financial institution maintains procedures reasonably adapted to correctly identify a 3-digit NAICS code. (4) Incorrect determination of small business status, covered credit transaction, or covered application. [88 FR 35528, May 31, 2023, as amended at 91 FR 23606, May 1, 2026] § 1002.113 Severability. If any provision of this subpart, or any application of a provision, is stayed or determined to be invalid, the remaining provisions or applications are severable and shall continue in effect. § 1002.114 Effective date, compliance date, and special transitional rules. (a) Effective date. (b) Compliance date. (1) A covered financial institution that originated at least 1,000 covered credit transactions for small businesses in each of calendar years 2026 and 2027 shall comply with the requirements of this subpart beginning January 1, 2028. (2)-(3) [Reserved] (4) A financial institution that did not originate at least 1,000 covered credit transactions for small businesses in each of calendar years 2026 and 2027 but subsequently originates at least 1,000 such transactions in two consecutive calendar years shall comply with the requirements of this subpart in accordance with § 1002.105(b), but in any case no earlier than January 1, 2029. (c) Special transitional rules Collection of certain information prior to the compliance date. (2) Determining which compliance date applies to a financial institution that does not collect information sufficient to determine small business status. (3) Alternative time period for determining compliance dates. [88 FR 35528, May 31, 2023, as amended at 89 FR 55029, July 3, 2024; 89 FR 76713, Sept. 19, 2024; 90 FR 25880, June 18, 2025; 90 FR 47520, Oct. 2, 2025; 91 FR 23606, May 1, 2026] Appendix A to Part 1002—Federal Agencies To Be Listed in Adverse Action Notices The following list indicates the Federal agency or agencies that should be listed in notices provided by creditors pursuant to § 1002.9(b)(1). Any questions concerning a particular creditor may be directed to such agencies. This list is not intended to describe agencies' enforcement authority for ECOA and Regulation B. Terms that are not defined in the Federal Deposit Insurance Act (12 U.S.C. 1813(s)) shall have the meaning given to them in the International Banking Act of 1978 (12 U.S.C. 3101). 1. Banks, savings associations, and credit unions with total assets of over $10 billion and their affiliates: 2. To the extent not included in item 1 above: a. National Banks, Federal savings associations, and Federal branches and Federal agencies of foreign banks: b. State member banks, branches and agencies of foreign banks (other than Federal branches, Federal agencies, and insured State branches of foreign banks), commercial lending companies owned or controlled by foreign banks, and organizations operating under section 25 or 25A of the Federal Reserve Act: c. Nonmember Insured Banks, Insured State Branches of Foreign Banks, and Insured State Savings Associations: d. Federal Credit Unions: 3. Air Carriers: 4. Creditors Subject to Surface Transportation Board: 5. Creditors Subject to Packers and Stockyards Act: 6. Small Business Investment Companies: 7. Brokers and Dealers: 8. Federal Land Banks, Federal Land Bank Associations, Federal Intermediate Credit Banks, and Production Credit Associations: 9. Retailers, Finance Companies, and All Other Creditors Not Listed Above: [88 FR 58065, Aug. 25, 2023] Appendix B to Part 1002—Model Application Forms 1. This appendix contains four model credit application forms, each designated 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 second for closed-end, secured transactions; the third for closed-end transactions, whether unsecured or secured; and the fourth in transactions involving community property or occurring in community property States. This appendix also contains a data collection model form for collecting information concerning an applicant's ethnicity, race, and sex that complies with the requirements of § 1002.13(a)(1)(i)(A) and (ii). Appendix B to 12 CFR part 1003 provides a data collection model form for collecting information concerning an applicant's ethnicity, race, and sex that complies with the requirements of § 1002.13(a)(1)(i)(B) and (ii). All forms contained in this appendix are models; their use by creditors is optional. 2. 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 § 1002.5; by deleting any information request; or by rearranging the format without modifying the substance of the inquiries. In any of these three instances, however, the appropriate notices regarding the optional nature of courtesy titles, the option to disclose alimony, child support, or separate maintenance, and the limitation concerning marital status inquiries must be included in the appropriate places if the items to which they relate appear on the creditor's form. 3. 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 (b), (c) and (d) of § 1002.5 of this part. [76 FR 79445, Dec. 21, 2011, as amended at 82 FR 45694, 45695, Oct. 2, 2017] Appendix C to Part 1002—Sample Notification Forms 1. This Appendix contains ten sample notification forms. Forms C-1 through C-4 are intended for use in notifying an applicant that adverse action has been taken on an application or account under §§ 1002.9(a)(1) and (2)(i) of this part. Form C-5 is a notice of disclosure of the right to request specific reasons for adverse action under §§ 1002.9(a)(1) and (2)(ii). Form C-6 is designed for use in notifying an applicant, under § 1002.9(c)(2), that an application is incomplete. Forms C-7 and C-8 are intended for use in connection with applications for business credit under § 1002.9(a)(3). Form C-9 is designed for use in notifying an applicant of the right to receive a copy of appraisals under § 1002.14. Form C-10 is designed for use in notifying an applicant for nonmortgage credit that the creditor is requesting applicant characteristic information. 2. Form C-1 contains the Fair Credit Reporting 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 information from a consumer reporting agency that was considered in the credit decision). A creditor must provide the section 615(a) disclosure when adverse action is taken against a consumer based on information from a consumer reporting agency. A creditor must provide the section 615(b) disclosure when adverse action is taken based on information from an outside source other than a consumer reporting agency. In addition, a creditor must provide the section 615(b) disclosure if the creditor obtained information from an affiliate other than information in a consumer report or other than information concerning the affiliate's own transactions or experiences with the consumer. Creditors may comply with the disclosure requirements for adverse action based on information in a consumer report obtained from an affiliate by providing either the section 615(a) or section 615(b) disclosure. Optional language in Forms C-1 through C-5 may be used to direct the consumer to the entity that provided the credit score for any questions about the credit score, along with the entity's contact information. Creditors may use or not use this additional language without losing the safe harbor, since the language is optional. 3. 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 creditor chooses to use the checklist of reasons provided in one of the sample forms in this appendix and if reasons commonly used by the creditor are not provided on the form, the creditor should modify the checklist by substituting or adding other reasons. For example, if “inadequate down payment” or “no deposit relationship with us” are common reasons for taking adverse action on an application, the creditor ought to add or substitute such reasons for those presently contained on the sample forms. 4. 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 institutions and disregard finance company references 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 appropriate explanation. The creditor need not, however, describe how or why a factor adversely affected the application. For example, the notice may say “length of residence” rather than “too short a period of residence.” 5. A creditor may design its own notification forms or use all or a portion of the forms contained in this Appendix. Proper use of Forms C-1 through C-4 will satisfy the requirement of § 1002.9(a)(2)(i). Proper use of Forms C-5 and C-6 constitutes full compliance with §§ 1002.9(a)(2)(ii) and 1002.9(c)(2), respectively. Proper use of Forms C-7 and C-8 will satisfy the requirements of §§ 1002.9(a)(2)(i) and (ii), respectively, for applications for business credit. Proper use of Form C-9 will satisfy the requirements of § 1002.14 of this part. Proper use of Form C-10 will satisfy the requirements of § 1002.5(b)(1). 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 Requested Credit: Description of Action Taken: Part I—Principal Reason(s) for Credit Denial, Termination, or Other Action Taken Concerning Credit This section must be completed in all instances. ____Credit application incomplete ____Insufficient number of credit references provided ____Unacceptable type of credit references provided ____Unable to verify credit references ____Temporary or irregular employment ____Unable to verify employment ____Length of employment ____Income insufficient for amount of credit requested ____Excessive obligations in relation to income ____Unable to verify income ____Length of residence ____Temporary residence ____Unable to verify residence ____No credit file ____Limited credit experience ____Poor credit performance with us ____Delinquent past or present credit obligations with others ____Collection action or judgment ____Garnishment or attachment ____Foreclosure or repossession ____Bankruptcy ____Number of recent inquiries on credit bureau report ____Value or type of collateral not sufficient ____Other, specify: ______ Part II—Disclosure of Use of Information 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 report 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 reporting agency played no part in our decision and is unable to supply specific reasons why we have denied credit to you. You also have a right to a free copy of your report from the reporting agency, if you request it no later than 60 days after you receive this notice. In addition, if you find that any information contained in the report you receive is inaccurate or incomplete, you have the right to dispute the matter with the reporting agency. Name: Address: [Toll-free] Telephone number: [We also obtained your credit score from the consumer reporting agency and used it in making our credit decision. Your credit score is a number that reflects the information in your consumer report. Your credit score can change, depending on how the information in your consumer report changes. Your credit score: Date: Scores range from a low of ________ to a high of ________. Key factors that adversely affected your credit score: [Number of recent inquiries on consumer report, as a key factor] [If you have any questions regarding your credit score, you should contact [entity that provided the credit score] at: Address: [[Toll-free] Telephone number: ________] ____Our credit decision was based in whole or in part on information obtained from an affiliate or from an outside source other than a consumer reporting agency. Under the Fair Credit Reporting Act, you have the right to make a written request, no later than 60 days after you receive this notice, for disclosure of the nature of this information. If you have any questions regarding this notice, you should contact: Creditor's name: Creditor's address: Creditor's telephone number: Notice: 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 increase in your credit limit] was carefully considered, 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. 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 excessive in relation to income. Other: The consumer reporting agency contacted that provided information that influenced our decision in whole or in part was [name, address and [toll-free] telephone number of the reporting agency]. The reporting agency played no part in our decision and is unable to supply specific reasons why we have denied credit to you. You have a right under the Fair Credit Reporting Act to know the information contained in your credit file at the consumer reporting agency. You also have a right to a free copy of your report from the reporting agency, if you request it no later than 60 days after you receive this notice. In addition, if you find that any information contained in the report you receive is inaccurate or incomplete, you have the right to dispute the matter with the reporting agency. Any questions regarding such information should be directed to [consumer reporting agency]. If you have any questions regarding this letter, you should contact us at [creditor's name, address and telephone number]. [We also obtained your credit score from the consumer reporting agency and used it in making our credit decision. Your credit score is a number that reflects the information in your consumer report. Your credit score can change, depending on how the information in your consumer report changes. Your credit score: Date: Scores range from a low of ________ to a high of ________. Key factors that adversely affected your credit score: [Number of recent inquiries on consumer report, as a key factor] [If you have any questions regarding your credit score, you should contact [entity that provided the credit score] at: Address: [[Toll-free] Telephone number: ________] Notice: Form C-3—Sample Notice of Action Taken and Statement of Reasons (Credit Scoring) Date Dear Applicant: Thank you for your recent application for __________. We regret that we are unable to approve your request. [Reasons for Denial of Credit] Your application was processed by a [credit scoring] system that assigns a numerical value to the various items of information we consider in evaluating an application. These numerical values are based upon the results of analyses of repayment histories of large numbers of customers. The information you provided in your application 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 • Number of recent inquiries on credit bureau report [Your Right to Get Your Consumer Report] In evaluating your application the consumer reporting agency listed below provided us with information that in whole or in part influenced our decision. The consumer reporting agency played no part in our decision and is unable to supply specific reasons why we have denied credit to you. You have a right under the Fair Credit Reporting Act to know the information contained in your credit file at the consumer reporting agency. It can be obtained by contacting: [Name, address, and [toll-free] telephone number of the consumer reporting agency]. You also have a right to a free copy of your report from the reporting agency, if you request it no later than 60 days after you receive this notice. In addition, if you find that any information contained in the report you receive is inaccurate or incomplete, you have the right to dispute the matter with the reporting agency. [Information about Your Credit Score] [Information about Your Credit Score] We also obtained your credit score from the consumer reporting agency and used it in making our credit decision. Your credit score is a number that reflects the information in your consumer report. Your credit score can change, depending on how the information in your consumer report changes. Your credit score: Date: Scores range from a low of ________ to a high of ________. Key factors that adversely affected your credit score: [Number of recent inquiries on consumer report, as a key factor] [If you have any questions regarding your credit score, you should contact [entity that provided the credit score] at: Address: [Toll-free] Telephone number: ________] If you have any questions regarding this letter, you should contact us at Creditor's Name: Address: Telephone: Sincerely, Notice: Form C-4—Sample Notice of Action Taken, Statement of Reasons and Counteroffer Date Dear Applicant: Thank you for your application for __________. We are unable to offer 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 notify us within [amount of time] at the following address: __________. Our credit decision on your application was based in whole or in part on information obtained in a report from [name, address and [toll-free] telephone number of the consumer reporting agency]. 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 reporting agency played no part in our decision and is unable to supply specific reasons why we have denied credit to you. You also have a right to a free copy of your report from the reporting agency, if you request it no later than 60 days after you receive this notice. In addition, if you find that any information contained in the report you receive is inaccurate or incomplete, you have the right to dispute the matter with the reporting agency. [We also obtained your credit score from the consumer reporting agency and used it in making our credit decision. Your credit score is a number that reflects the information in your consumer report. Your credit score can change, depending on how the information in your consumer report changes. Your credit score: Date: Scores range from a low of ________ to a high of ________. Key factors that adversely affected your credit score: [Number of recent inquiries on consumer report, as a key factor] [If you have any questions regarding your credit score, you should contact [entity that provided the credit score] at: Address: [Toll-free] Telephone number:________] 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 (provided the applicant has the capacity to enter into a binding contract), 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 believe there has been discrimination in handling your application you should contact the [name and address of the appropriate Federal enforcement agency listed in appendix A]. Sincerely, Form C-5—Sample Disclosure of Right To Request Specific Reasons for Credit Denial Date Dear Applicant: Thank you for applying to us for __________. 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 [toll-free] telephone number is shown below. The reporting agency played no part in our decision and is unable to supply specific reasons why we have denied credit to you. [You have a right under the Fair Credit Reporting Act to know the information contained in your credit file at the consumer reporting agency.] You have a right to a free copy of your report from the reporting agency, if you request it no later than 60 days after you receive this notice. In addition, if you find that any information contained in the report you received is inaccurate or incomplete, you have the right to dispute the matter with the reporting agency. You can find out about the information contained in your file (if one was used) by contacting: Consumer reporting agency's name Address [Toll-free] Telephone number [We also obtained your credit score from the consumer reporting agency and used it in making our credit decision. Your credit score is a number that reflects the information in your consumer report. Your credit score can change, depending on how the information in your consumer report changes. Your credit score: Date: Scores range from a low of ________ to a high of ________. Key factors that adversely affected your credit score: [Number of recent inquiries on consumer report, as a key factor] [If you have any questions regarding your credit score, you should contact [entity that provided the credit score] at: Address: [Toll-free] Telephone number: ________] Sincerely, Notice: Form C-6—Sample Notice of Incomplete Application and Request for Additional Information 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 further consideration to your credit request. Sincerely, Form C-7—Sample Notice of Action Taken and Statement of Reasons (Business Credit) 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 Opportunity Act prohibits creditors from discriminating against credit 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 applicant's 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-8—Sample Disclosure of Right To Request Specific Reasons for Credit Denial Given at Time of Application (Business Credit) Creditor's name Creditor's address If your application for business credit is denied, you have the right to a written statement of the specific reasons for the denial. To obtain the statement, please contact [name, address 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 Opportunity Act prohibits creditors from discriminating against credit 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 applicant's 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-9—Sample Disclosure of Right To Receive a Copy of Appraisals We may order an appraisal to determine the property's value and charge you for this appraisal. We will promptly give you a copy of any appraisal, even if your loan does not close. You can pay for an additional appraisal for your own use at your own cost. [In your letter, give us the following information:] Form C-10—Sample Disclosure About Voluntary Data Notation We are requesting the following information to monitor our compliance with the Federal Equal Credit Opportunity Act, which prohibits unlawful discrimination. You are not required to provide this information. We will not take this information (or your decision not to provide this information) into account in connection with your application or credit transaction. The law provides that a creditor may not discriminate based on this information, or based on whether or not you choose to provide it. [If you choose not to provide the information, we will note it by visual observation or surname]. [76 FR 79445, Dec. 21, 2011, as amended at 78 FR 7248, Jan. 31, 2013] Appendix D to Part 1002—Issuance of Official Interpretations 1. Official Interpretations. 2. Requests for Issuance of Official Interpretations. 3. Scope of Interpretations. [76 FR 79445, Dec. 21, 2011, as amended at 88 FR 16538, Mar. 20, 2023] Appendix E to Part 1002—Sample Form for Collecting Certain Applicant-Provided Data Under Subpart B of This Part [91 FR 23607, May 1, 2026] Appendix F to Part 1002—Tolerances for Bona Fide Errors in Data Reported Under Subpart B of This Part As set out in § 1002.112(b) and in comment 112(b)-1 of supplement I to this part, a financial institution is presumed to maintain procedures reasonably adapted to avoid errors with respect to a given data field if the number of errors found in a random sample of a financial institution's data submission for a given data field do not equal or exceed the threshold in column C of the following table: Table 1 to Appendix F—Tolerance Thresholds for Bona Fide Errors Small business lending application register count Random sample size Threshold Threshold 1,000-100,000 79 4 5.1 100,001+ 159 4 2.5 The size of the random sample, under column B, shall depend on the size of the financial institution's small business lending application register, as shown in column A of table 1 to this appendix. The thresholds in column C of table 1 to this appendix reflect the number of unintentional errors a financial institution may make within a particular data field ( e.g., For instance, a financial institution that submitted a small business lending application register containing 11,000 applications would be subject to a threshold of four errors per data field. If the financial institution had made two errors in reporting loan amount and two errors reporting gross annual income, all of these errors would be covered by the bona fide error provision of § 1002.112(b) and would not constitute a violation of the Act or this part. If the same financial institution had made five errors in reporting loan amount and two errors reporting gross annual revenue, the bona fide error provision of § 1002.112(b) would not apply to the five loan amount errors but would still apply to the two gross annual revenue errors. Even when the number of errors in a particular data field do not equal or exceed the threshold in column C, if either there is a reasonable basis to believe that errors in that field were intentional or there is evidence that the financial institution did not maintain procedures reasonably adapted to avoid such errors, then the errors are not bona fide errors under § 1002.112(b). For purposes of determining bona fide errors under § 1002.112(b), the term “data field” generally refers to individual fields. Some data fields may allow for more than one response. For example, with respect to information on the ethnicity or race of an applicant's principal owners, a data field may identify more than one race or more than one ethnicity for a given person. If one or more of the ethnicities or races identified in a data field are erroneous, they count as one (and only one) error for that data field. [91 FR 23607, May 1, 2026] Supplement I to Part 1002—Official Interpretations Following is an official interpretation of Regulation B (12 CFR part 1002) issued by the Bureau of Consumer Financial Protection. References are to sections of the regulation or the Equal Credit Opportunity Act (15 U.S.C. 1601 et seq. Introduction 1. Official status. 2. Issuance of interpretations. Federal Register. 3. Comment designations. Section 1002.1—Authority, Scope, and Purpose 1(a) Authority and scope. 1. Scope. 2. Foreign applicability. 3. Bureau. Bureau, Section 1002.2—Definitions 2(c) Adverse action. Paragraph 2(c)(1)(i). 1. Application for credit. Paragraph 2(c)(1)(ii). 1. Move from service area. 2. Termination based on credit limit. Paragraph 2(c)(2)(ii). 1. Default—exercise of due-on-sale clause. 2. Current delinquency or default. Paragraph 2(c)(2)(iii). 1. Point-of-sale transactions. i. A credit cardholder presents an expired card or a card that has been reported to the card issuer as lost or stolen. ii. The amount of a transaction exceeds a cash advance or credit limit. iii. The circumstances (such as excessive use of a credit card in a short period of time) suggest that fraud is involved. iv. The authorization facilities are not functioning. v. Billing statements have been returned to the creditor for lack of a forwarding address. 2. Application for increase in available credit. Paragraph 2(c)(2)(v). 1. Terms of credit versus type of credit offered. 2(e) Applicant. 1. Request to assume loan. 2(f) Application. 1. General. 2. Procedures used. 3. When an inquiry or prequalification request becomes an application. 4. Examples of inquiries that are not applications. i. A consumer calls to ask about loan terms and an employee explains the creditor's basic loan terms, such as interest rates, loan-to-value ratio, and debt-to-income ratio. ii. A consumer calls to ask about interest rates for car loans, and, in order to quote the appropriate rate, the loan officer asks for the make and sales price of the car and the amount of the downpayment, then gives the consumer the rate. iii. A consumer asks about terms for a loan to purchase a home and tells the loan officer her income and intended downpayment, but the loan officer only explains the creditor's loan-to-value ratio policy and other basic lending policies, without telling the consumer whether she qualifies for the loan. iv. A consumer calls to ask about terms for a loan to purchase vacant land and states his income and the sales price of the property to be financed, and asks whether he qualifies for a loan; the employee responds by describing the general lending policies, explaining that he would need to look at all of the consumer's qualifications before making a decision, and offering to send an application form to the consumer. 5. Examples of an application. i. A person asks a financial institution to “preapprove” her for a loan (for example, to finance a house or a vehicle she plans to buy) and the institution reviews the request under a program in which the institution, after a comprehensive analysis of her creditworthiness, issues a written commitment valid for a designated period of time to extend a loan up to a specified amount. The written commitment may not be subject to conditions other than conditions that require the identification of adequate collateral, conditions that require no material change in the applicant's financial condition or creditworthiness prior to funding the loan, and limited conditions that are not related to the financial condition or creditworthiness of the applicant that the lender ordinarily attaches to a traditional application (such as certification of a clear termite inspection for a home purchase loan, or a maximum mileage requirement for a used car loan). But if the creditor's program does not provide for giving written commitments, requests for preapprovals are treated as prequalification requests for purposes of the regulation. ii. Under the same facts as above, the financial institution evaluates the person's creditworthiness and determines that she does not qualify for a preapproval. 6. Completed application—diligence requirement. 2(g) Business credit. 1. Definition. 2(j) Credit. 1. General. 2(l) Creditor. 1. Assignees. 2. Referrals to creditors. 2(p) Empirically Derived and Other Credit Scoring Systems 1. Purpose of definition. 2. Periodic revalidation. 3. Pooled data scoring systems. 4. Disparate treatment. 2(w) Open-end credit. 1. Open-end real estate mortgages. 2(z) Prohibited basis. 1. Persons associated with applicant. 2. National origin. 3. Public assistance program. Section 1002.3—Limited Exceptions for Certain Classes of Transactions 1. Scope. 3(a) Public-utilities credit. 1. Definition. 2. Security deposits. 3. Telephone companies. 3(c) Incidental credit. 1. Examples. 3(d) Government credit. 1. Credit to governments. Section 1002.4—General Rules Paragraph 4(a). 1. Scope of rule. 2. Examples. i. Disparate treatment would exist, for example, in the following situations: A. A creditor provides information only on “subprime” and similar products to minority applicants who request information about the creditor's mortgage products, but provides information on a wider variety of mortgage products to similarly situated nonminority applicants. B. A creditor provides more comprehensive information to men than to similarly situated women. C. A creditor requires a minority applicant to provide greater documentation to obtain a loan than a similarly situated nonminority applicant. D. A creditor waives or relaxes credit standards for a nonminority applicant but not for a similarly situated minority applicant. ii. Treating applicants differently on a prohibited basis is unlawful if the creditor lacks a legitimate nondiscriminatory reason for its action, or if the asserted reason is found to be a pretext for discrimination. Paragraph 4(b) 1. Discouragement. i. Statements prohibited by § 1002.4(b) include: A. A statement that the applicant should not bother to apply, after the applicant states that he is retired. B. Statements directed at the general public that express a discriminatory preference or a policy of exclusion against consumers based on one or more prohibited basis characteristics in violation of the Act. C. The use of interview scripts that discourage applications on a prohibited basis. ii. Statements not prohibited by § 1002.4(b) include: A. Statements directed at one group of consumers, encouraging that group of consumers to apply for credit. B. Statements in support of local law enforcement. C. Statements recommending that, before buying a home in a particular neighborhood, consumers investigate, for example, the neighborhood's schools, its proximity to grocery stores, and its crime statistics. D. Statements encouraging consumers to seek out resources to develop their financial literacy. Paragraph 4(c). 1. Requirement for written applications. 2. Telephone applications. 3. Computerized entry. Applications through electronic media and Applications through video. Paragraph 4(d). 1. Clear and conspicuous. 2. Form of disclosures. i. If an applicant accesses a credit application electronically (other than as described under ii below), such as online at a home computer, the creditor must provide the disclosures in electronic form (such as with the application form on its Web site) in order to meet the requirement to provide disclosures in a timely manner on or with the application. If the creditor instead mailed paper disclosures to the applicant, this requirement would not be met. ii. In contrast, if an applicant is physically present in the creditor's office, and accesses a credit application electronically, such as via a terminal or kiosk (or if the applicant uses a terminal or kiosk located on the premises of an affiliate or third party that has arranged with the creditor to provide applications to consumers), the creditor may provide disclosures in either electronic or paper form, provided the creditor complies with the timing, delivery, and retainability requirements of the regulation. Section 1002.5—Rules Concerning Requests for Information 5(a) General rules. Paragraph 5(a)(1). 1. Requests for information. 5(a)(2) Required Collection of Information 1. Local laws. 2. Information required by Regulation C. 3. Collecting information on behalf of creditors. 4. Information required by subpart B. 5(a)(4) Other Permissible Collection of Information 1. Other permissible collection of information. 5(d) Other limitations on information requests. Paragraph 5(d)(1). 1. Indirect disclosure of prohibited information. i. The applicant's obligation to pay alimony, child support, or separate maintenance income. ii. The source of income to be used as the basis for repaying the credit requested, which could disclose that it is the income of a spouse. iii. Whether any obligation disclosed by the applicant has a co-obligor, which could disclose that the co-obligor is a spouse or former spouse. iv. The ownership of assets, which could disclose the interest of a spouse. Paragraph 5(d)(2). 1. Disclosure about income. 2. General inquiry about source of income. 3. Specific inquiry about sources of income. Section 1002.6—Rules Concerning Evaluation of Applications 6(a) General Rule Concerning Use of Information 1. General. 2. Disparate treatment. 6(b) Specific rules concerning use of information. Paragraph 6(b)(1). 1. Prohibited basis Paragraph 6(b)(2). 1. Favoring the elderly. 2. Consideration of age in a credit scoring system. i. Age-split scorecards. 3. Consideration of age in a judgmental system. i. A creditor may consider the applicant's occupation and length of time to retirement to ascertain whether the applicant's income (including retirement income) will support the extension of credit to its maturity. ii. A creditor may consider the adequacy of any security offered when the term of the credit extension exceeds the life expectancy of the applicant and the cost of realizing on the collateral could exceed the applicant's equity. An elderly applicant might not qualify for a 5 percent down, 30-year mortgage loan but might qualify with a larger downpayment or a shorter loan maturity. iii. A creditor may consider the applicant's age to assess the significance of length of employment (a young applicant may have just entered the job market) or length of time at an address (an elderly applicant may recently have retired and moved from a long-term residence). 4. Consideration of age in a reverse mortgage. 5. Consideration of age in a combined system. 6. Consideration of public assistance. i. The length of time an applicant will likely remain eligible to receive such income. ii. Whether the applicant will continue to qualify for benefits based on the status of the applicant's dependents (as in the case of Temporary Aid to Needy Families, or social security payments to a minor). iii. Whether the creditor can attach or garnish the income to assure payment of the debt in the event of default. Paragraph 6(b)(5). 1. Consideration of an individual applicant. 2. Payments consistently made. 3. Consideration of income. i. A creditor need not consider income at all in evaluating creditworthiness. If a creditor does consider income, there are several acceptable methods, whether in a credit scoring or a judgmental system: A. A creditor may score or take into account the total sum of all income stated by the applicant without taking steps to evaluate the income for reliability. B. A creditor may evaluate each component of the applicant's income, and then score or take into account income determined to be reliable separately from other income; or the creditor may disregard that portion of income that is not reliable when it aggregates reliable income. C. A creditor that does not evaluate all income components for reliability must treat as reliable any component of protected income that is not evaluated. ii. In considering the separate components of an applicant's income, the creditor may not automatically discount or exclude from consideration any protected income. Any discounting or exclusion must be based on the applicant's actual circumstances. 4. Part-time employment, sources of income. Paragraph 6(b)(6). 1. Types of credit references. Paragraph 6(b)(7). 1. National origin—immigration status. 2. National origin—citizenship. Paragraph 6(b)(8). 1. Prohibited basis—marital status. Section 1002.7—Rules Concerning Extensions of Credit 7(a) Individual accounts. 1. Open-end credit—authorized user. 2. Open-end credit—choice of authorized user. 3. Overdraft authority on transaction accounts. 7(b) Designation of name. 1. Single name on account. 7(c) Action concerning existing open-end accounts. Paragraph 7(c)(1). 1. Termination coincidental with marital status change. i. Repudiate responsibility for future charges on the joint account. ii. Request separate accounts in their own names. iii. Request that the joint account be closed. 2. Updating information. Paragraph 7(c)(2). 1. Procedure pending reapplication. 7(d) Signature of spouse or other person. 1. Qualified applicant. 2. Unqualified applicant. Paragraph 7(d)(1). 1. Signature of another person. 2. Joint applicant. 3. Evidence of joint application. Paragraph 7(d)(2). 1. Jointly owned property. i. Valuation of applicant's interest. ii. Other options to support credit. A. Providing a co-signer or other party (§ 1002.7(d)(5)); B. Requesting that the credit be granted on a secured basis (§ 1002.7(d)(4)); or C. Providing the signature of the joint owner on an instrument that ensures access to the property in the event of the applicant's death or default, but does not impose personal liability unless necessary under state law (such as a limited guarantee). A creditor may not routinely require, however, that a joint owner sign an instrument (such as a quitclaim deed) that would result in the forfeiture of the joint owner's interest in the property. 2. Need for signature—reasonable belief. Paragraph 7(d)(3). 1. Residency. Paragraph 7(d)(4). 1. Creation of enforceable lien. 2. Need for signature—reasonable belief. 3. Integrated instruments. Paragraph 7(d)(5). 1. Qualifications of additional parties. 2. Reliance on income of another person individual credit. 3. Renewals. Paragraph 7(d)(6). 1. Guarantees. 2. Spousal guarantees. 7(e) Insurance. 1. Differences in terms. 2. Insurance information. Section 1002.8—Special Purpose Credit Programs 8(a) Standards for Programs 1. Determining qualified programs. 2. Compliance with a program authorized by Federal or State law. 3. Expressly authorized. 4. Creditor liability. 5. Determining need. 6. Elements of the program. 8(b) Controlling Provisions 1. Applicability of rules. 2. Use of common characteristics. 8(c) Special Rule Concerning Requests and Use of Information 1. Request of prohibited basis information. 2. Example. Section 1002.9—Notifications 1. Use of the term adverse action. 2. Expressly withdrawn applications. 3. When notification occurs. 4. Location of notice. 5. Prequalification requests. 9(a) Notification of action taken, ECOA notice, and statement of specific reasons. Paragraph 9(a)(1). 1. Timing of notice—when an application is complete. 2. Notification of approval. 3. Incomplete application—denial for incompleteness. 4. Incomplete application—denial for reasons other than incompleteness. 5. Length of counteroffer. 6. Counteroffer combined with adverse action notice. 7. Denial of a telephone application. Paragraph 9(a)(3). 1. Coverage. 2. Trade credit. 3 . Factoring. 4. Manner of compliance. 5. Timing of notification. 9(b) Form of ECOA notice and statement of specific reasons. Paragraph 9(b)(1). 1. Substantially similar notice. Paragraph 9(b)(2). 1. Number of specific reasons. 2. Source of specific reasons. 3. Description of reasons. 4. Credit scoring system. 5. Credit scoring method for selecting reasons. 6. Judgmental system. 7. Combined credit scoring and judgmental system. 8. Automatic denial. 9. Combined ECOA-FCRA disclosures. 9(c) Incomplete applications. Paragraph 9(c)(1). 1. Exception for preapprovals. Paragraph 9(c)(2). 1. Reapplication. Paragraph 9(c)(3). 1. Oral inquiries for additional information. 9(g) Applications submitted through a third party. 1. Third parties. 2. Third party notice—enforcement agency. 3. Third-party notice—liability. Section 1002.10—Furnishing of Credit Information 1. Scope. 2. Reporting on all accounts. 3. Designating accounts. 4. File and index systems. 10(a) Designation of accounts. 1. New parties. 2. Request to change designation of account. Section 1002.11—Relation to State Law 11(a) Inconsistent state laws. 1. Preemption determination—New York. i. Article 15, section 296a(1)(b). Unlawful discriminatory practices in relation to credit on the basis of race, creed, color, national origin, age, sex, marital status, or disability. This provision is preempted to the extent that it bars taking a prohibited basis into account when establishing eligibility for certain special-purpose credit programs. ii. Article 15, section 296a(1)(c). Unlawful discriminatory practice to make any record or inquiry based on race, creed, color, national origin, age, sex, marital status, or disability. This provision is preempted to the extent that it bars a creditor from requesting and considering information regarding the particular characteristics (for example, race, national origin, or sex) required for eligibility for special-purpose credit programs. 2. Preemption determination—Ohio. i. Section 4112.021(B)(1)—Unlawful discriminatory practices in credit transactions. This provision is preempted to the extent that it bars asking or favorably considering the age of an elderly applicant; prohibits the consideration of age in a credit scoring system; permits without limitation the consideration of age in real estate transactions; and limits the consideration of age in special-purpose credit programs to certain government-sponsored programs identified in the state law. Section 1002.12—Record Retention 12(a) Retention of prohibited information. 1. Receipt of prohibited information. 2. Use of retained information. 12(b) Preservation of records. 1. Copies. 2. Computerized decisions. Paragraph 12(b)(3). 1. Withdrawn and brokered applications. i. An application is withdrawn by the applicant. ii. An application is submitted to more than one creditor on behalf of the applicant, and the application is approved by one of the other creditors. 12(b)(6) Self-tests. 1. The rule requires all written or recorded information about a self-test to be retained for 25 months after a self-test has been completed. For this purpose, a self-test is completed after the creditor has obtained the results and made a determination about what corrective action, if any, is appropriate. Creditors are required to retain information about the scope of the self-test, the methodology used and time period covered by the self-test, the report or results of the self-test including any analysis or conclusions, and any corrective action taken in response to the self-test. 12(b)(7) Preapplication Marketing Information 1. Prescreened credit solicitations. 2. List of criteria. 3. Correspondence. Section 1002.13—Information for Monitoring Purposes 13(a) Information to be requested. 1. Natural person. 2. Principal residence. 3. Temporary financing. 4. New principal residence. 5. Transactions not covered. 6. Refinancings. 7. Data collection under Regulation C. See also 8. Application-by-application basis. 13(b) Obtaining of Information 1. Forms for collecting data. 2. Written applications. 3. Telephone, mail applications. ii. A creditor that accepts an application by mail need not make a special request for the monitoring information if the applicant has failed to provide it on the application form returned to the creditor. iii. If it is not evident on the face of an application that it was received by mail, telephone, or via an electronic medium, the creditor should indicate on the form or other application record how the application was received. 4. Video and other electronic-application processes. ii. If an applicant applies through an electronic medium without video capability, the creditor treats the application as if it were received by mail. 5. Applications through loan-shopping services. 6. Inadvertent notation. 13(c) Disclosure to applicants. 1. Procedures for providing disclosures. 13(d) Substitute monitoring program. 1. Substitute program. Section 1002.14—Rules on Providing Appraisals and Valuations 14(a) Providing appraisals and other valuations. 1. Multiple applicants. 14(a)(1) In general. 1. Coverage. 2. Renewals. 3. Written. 4. Timing. i. For purposes of this timing requirement, “provide” means “deliver.” Delivery occurs three business days after mailing or delivering the copies to the last-known address of the applicant, or when evidence indicates actual receipt by the applicant, whichever is earlier. Delivery to or actual receipt by the applicant by electronic means must comply with the E-Sign Act, as provided for in § 1002.14(a)(5). ii. The application and meaning of the “promptly upon completion” standard depends upon the facts and circumstances, including but not limited to when the creditor receives the appraisal or other written valuation, and the extent of any review or revision after the creditor receives it. iii. “Completion” occurs when the last version is received by the creditor, or when the creditor has reviewed and accepted the appraisal or other written valuation to include any changes or corrections required, whichever is later. See also iv. In a transaction that is being consummated (for closed-end credit) or in which the account is being opened (for open-end credit), if an appraisal or other written valuation has been developed but is not yet complete, the deadline for providing a copy of three business days before consummation or account opening still applies, unless the applicant waived that deadline as provided under § 1002.14(a)(1), in which case the copy must be provided at or before consummation or account opening. v. Even if the transaction will not be consummated (for closed-end credit) or the account will not be opened (for open-end credit), the copy must be provided “promptly upon completion” as provided for in § 1002.14(a)(1), unless the applicant has waived that deadline as provided under § 1002.14(a)(1), in which case as provided for in § 1002.14(a)(1) the copy must be provided to the applicant no later than 30 days after the creditor determines the transaction will not be consummated or the account will not be opened. 5. Promptly upon completion-examples. i. Sending a copy of an appraisal within a week of completion with sufficient time before consummation (or account opening for open-end credit). ii. Sending a copy of a revised appraisal within a week after completion and with sufficient time before consummation (or account opening for open-end credit). iii. Sending a copy of an AVM report within a week after its receipt and with sufficient time before consummation (or account opening for open-end credit). iv. Delay in sending an appraisal. v. Delay in sending an AVM report while waiting for completion of a second valuation. 6. Waiver. i. If, no later than three business days prior to consummation or account opening, the applicant provides the creditor an affirmative oral or written statement waiving the timing requirement under this rule; or ii. If, within three business days of consummation or account opening, the applicant provides the creditor an affirmative oral or written statement waiving the timing requirement under this rule and the waiver pertains solely to the applicant's receipt of a copy of an appraisal or other written valuation that contains only clerical changes from a previous version of the appraisal or other written valuation provided to the applicant three or more business days prior to consummation or account opening. For purpose of this second type of waiver, revisions will only be considered to be clerical in nature if they have no impact on the estimated value, and have no impact on the calculation or methodology used to derive the estimate. In addition, under § 1002.14(a)(1) the applicant still must receive the copy of the revision at or prior to consummation or account opening. 7. Multiple versions of appraisals or valuations. See also 14(a)(2) Disclosure. 1. Appraisal independence requirements not affected. 14(a)(3) Reimbursement. 1. Photocopy, postage, or other costs. 2. Reasonable fee for reimbursement. 14(b) Definitions. 14(b)(1) Consummation. 1. State law governs. 2. Credit vs. sale. 14(b)(2) Dwelling. 1. “Motor vehicles” not covered. 14(b)(3) Valuation. 1. Valuations—examples. i. A report prepared by an appraiser (whether or not licensed or certified) including the appraiser's estimate of the property's value or opinion of value. ii. A document prepared by the creditor's staff that assigns value to the property. iii. A report approved by a government-sponsored enterprise for describing to the applicant the estimate of the property's value developed pursuant to the proprietary methodology or mechanism of the government-sponsored enterprise. iv. A report generated by use of an automated valuation model to estimate the property's value. v. A broker price opinion prepared by a real estate broker, agent, or sales person to estimate the property's value. 2. Attachments and exhibits. 3. Other documentation. i. Internal documents that merely restate the estimated value of the dwelling contained in an appraisal or written valuation being provided to the applicant. ii. Governmental agency statements of appraised value that are publically available. iii. Publicly-available lists of valuations (such as published sales prices or mortgage amounts, tax assessments, and retail price ranges). iv. Manufacturers' invoices for manufactured homes. v. Reports reflecting property inspections that do not provide an estimate of the value of the property and are not used to develop an estimate of the value of the property. vi. Appraisal reviews that do not include the appraiser's estimate of the property's value or opinion of value. Section 1002.15—Incentives for Self-Testing and Self-Correction 15(a) General rules. 15(a)(1) Voluntary self-testing and correction. 1. Activities required by any governmental authority are not voluntary self-tests. A governmental authority includes both administrative and judicial authorities for Federal, State, and local governments. 15(a)(2) Corrective action required. 1. To qualify for the privilege, appropriate corrective action is required when the results of a self-test show that it is more likely than not that there has been a violation of the ECOA or this part. A self-test is also privileged when it identifies no violations. 2. In some cases, the issue of whether certain information is privileged may arise before the self-test is complete or corrective actions are fully under way. This would not necessarily prevent a creditor from asserting the privilege. In situations where the self-test is not complete, for the privilege to apply the lender must satisfy the regulation's requirements within a reasonable period of time. To assert the privilege where the self-test shows a likely violation, the rule requires, at a minimum, that the creditor establish a plan for corrective action and a method to demonstrate progress in implementing the plan. Creditors must take appropriate corrective action on a timely basis after the results of the self-test are known. 3. A creditor's determination about the type of corrective action needed, or a finding that no corrective action is required, is not conclusive in determining whether the requirements of this paragraph have been satisfied. If a creditor's claim of privilege is challenged, an assessment of the need for corrective action or the type of corrective action that is appropriate must be based on a review of the self-testing results, which may require an in camera 15(a)(3) Other privileges. 1. A creditor may assert the privilege established under this section in addition to asserting any other privilege that may apply, such as the attorney-client privilege or the work-product privilege. Self-testing data may be privileged under this section whether or not the creditor's assertion of another privilege is upheld. 15(b) Self-test defined. 15(b)(1) Definition. Paragraph 15(b)(1)(i). 1. To qualify for the privilege, a self-test must be sufficient to constitute a determination of the extent or effectiveness of the creditor's compliance with the Act and Regulation B. Accordingly, a self-test is only privileged if it was designed and used for that purpose. A self-test that is designed or used to determine compliance with other laws or regulations or for other purposes is not privileged under this rule. For example, a self-test designed to evaluate employee efficiency or customers' satisfaction with the level of service provided by the creditor is not privileged even if evidence of discrimination is uncovered incidentally. If a self-test is designed for multiple purposes, only the portion designed to determine compliance with the ECOA is eligible for the privilege. Paragraph 15(b)(1)(ii). 1. The principal attribute of self-testing is that it constitutes a voluntary undertaking by the creditor to produce new data or factual information that otherwise would not be available and could not be derived from loan or application files or other records related to credit transactions. Self-testing includes, but is not limited to, the practice of using fictitious applicants for credit (testers), either with or without the use of matched pairs. A creditor may elect to test a defined segment of its business, for example, loan applications processed by a specific branch or loan officer, or applications made for a particular type of credit or loan program. A creditor also may use other methods of generating information that is not available in loan and application files, such as surveying mortgage loan applicants. To the extent permitted by law, creditors might also develop new methods that go beyond traditional pre-application testing, such as hiring testers to submit fictitious loan applications for processing. 2. The privilege does not protect a creditor's analysis performed as part of processing or underwriting a credit application. A creditor's evaluation or analysis of its loan files, Home Mortgage Disclosure Act data, or similar types of records (such as broker or loan officer compensation records) does not produce new information about a creditor's compliance and is not a self-test for purposes of this section. Similarly, a statistical analysis of data derived from existing loan files is not privileged. 15(b)(3) Types of information not privileged. Paragraph 15(b)(3)(i). 1. The information listed in this paragraph is not privileged and may be used to determine whether the prerequisites for the privilege have been satisfied. Accordingly, a creditor might be asked to identify the self-testing method, for example, whether preapplication testers were used or data were compiled by surveying loan applicants. Information about the scope of the self-test (such as the types of credit transactions examined, or the geographic area covered by the test) also is not privileged. Paragraph 15(b)(3)(ii). 1. Property appraisal reports, minutes of loan committee meetings or other documents reflecting the basis for a decision to approve or deny an application, loan policies or procedures, underwriting standards, and broker compensation records are examples of the types of records that are not privileged. If a creditor arranges for testers to submit loan applications for processing, the records are not related to actual credit transactions for purposes of this paragraph and may be privileged self-testing records. 15(c) Appropriate corrective action. 1. The rule only addresses the corrective actions required for a creditor to take advantage of the privilege in this section. A creditor may be required to take other actions or provide additional relief if a formal finding of discrimination is made. 15(c)(1) General requirement. 1. Appropriate corrective action is required even though no violation has been formally adjudicated or admitted by the creditor. In determining whether it is more likely than not that a violation occurred, a creditor must treat testers as if they are actual applicants for credit. A creditor may not refuse to take appropriate corrective action under this section because the self-test used fictitious loan applicants. The fact that a tester's agreement with the creditor waives the tester's legal right to assert a violation does not eliminate the requirement for the creditor to take corrective action, although no remedial relief for the tester is required under paragraph 15(c)(3). 15(c)(2) Determining the scope of appropriate corrective action. 1. Whether a creditor has taken or is taking corrective action that is appropriate will be determined on a case-by-case basis. Generally, the scope of the corrective action that is needed to preserve the privilege is governed by the scope of the self-test. For example, a creditor that self-tests mortgage loans and discovers evidence of discrimination may focus its corrective actions on mortgage loans, and is not required to expand its testing to other types of loans. 2. In identifying the policies or practices that are a likely cause of the violation, a creditor might identify inadequate or improper lending policies, failure to implement established policies, employee conduct, or other causes. The extent and scope of a likely violation may be assessed by determining which areas of operations are likely to be affected by those policies and practices, for example, by determining the types of loans and stages of the application process involved and the branches or offices where the violations may have occurred. 3. Depending on the method and scope of the self-test and the results of the test, appropriate corrective action may include one or more of the following: i. If the self-test identifies individuals whose applications were inappropriately processed, offering to extend credit if the application was improperly denied and compensating such persons for out-of-pocket costs and other compensatory damages; ii. Correcting institutional policies or procedures that may have contributed to the likely violation, and adopting new policies as appropriate; iii. Identifying and then training and/or disciplining the employees involved; iv. Developing outreach programs, marketing strategies, or loan products to serve more effectively segments of the lender's markets that may have been affected by the likely discrimination; and v. Improving audit and oversight systems to avoid a recurrence of the likely violations. 15(c)(3) Types of relief. Paragraph 15(c)(3)(ii). 1. The use of pre-application testers to identify policies and practices that illegally discriminate does not require creditors to review existing loan files for the purpose of identifying and compensating applicants who might have been adversely affected. 2. If a self-test identifies a specific applicant who was discriminated against on a prohibited basis, to qualify for the privilege in this section the creditor must provide appropriate remedial relief to that applicant; the creditor is not required to identify other applicants who might also have been adversely affected. Paragraph 15(c)(3)(iii). 1. A creditor is not required to provide remedial relief to an applicant that would not be available by law. An applicant might also be ineligible for certain types of relief due to changed circumstances. For example, a creditor is not required to offer credit to a denied applicant if the applicant no longer qualifies for the credit due to a change in financial circumstances, although some other type of relief might be appropriate. 15(d)(1) Scope of privilege. 1. The privilege applies with respect to any examination, investigation or proceeding by Federal, State, or local government agencies relating to compliance with the Act or this part. Accordingly, in a case brought under the ECOA, the privilege established under this section preempts any inconsistent laws or court rules to the extent they might require disclosure of privileged self-testing data. The privilege does not apply in other cases (such as in litigation filed solely under a State's fair lending statute). In such cases, if a court orders a creditor to disclose self-test results, the disclosure is not a voluntary disclosure or waiver of the privilege for purposes of paragraph 15(d)(2); a creditor may protect the information by seeking a protective order to limit availability and use of the self-testing data and prevent dissemination beyond what is necessary in that case. Paragraph 15(d)(1) precludes a party who has obtained privileged information from using it in a case brought under the ECOA, provided the creditor has not lost the privilege through voluntary disclosure under paragraph 15(d)(2). 15(d)(2) Loss of privilege. Paragraph 15(d)(2)(i). 1. A creditor's corrective action, by itself, is not considered a voluntary disclosure of the self-test report or results. For example, a creditor does not disclose the results of a self-test merely by offering to extend credit to a denied applicant or by inviting the applicant to reapply for credit. Voluntary disclosure could occur under this paragraph, however, if the creditor disclosed the self-test results in connection with a new offer of credit. 2. The disclosure of self-testing results to an independent contractor acting as an auditor or consultant for the creditor on compliance matters does not result in loss of the privilege. Paragraph 15(d)(2)(ii). 1. The privilege is lost if the creditor discloses privileged information, such as the results of the self-test. The privilege is not lost if the creditor merely reveals or refers to the existence of the self-test. Paragraph 15(d)(2)(iii). 1. A creditor's claim of privilege may be challenged in a court or administrative law proceeding with appropriate jurisdiction. In resolving the issue, the presiding officer may require the creditor to produce privileged information about the self-test. Paragraph 15(d)(3) Limited use of privileged information. 1. A creditor may be required to produce privileged documents for the purpose of determining a penalty or remedy after a violation of the ECOA or Regulation B has been formally adjudicated or admitted. A creditor's compliance with such a requirement does not evidence the creditor's intent to forfeit the privilege. Section 1002.16—Enforcement, Penalties, and Liabilities 16(c) Failure of compliance. 1. Inadvertent errors. 2. Correction of error. Section 1002.102—Definitions 102(b) Applicant 1. General. 102(m) Minority-Owned Business 1. General. 2. Purpose of definition. 3. Further clarifications of terms used in the definition of minority-owned business. 4. Ownership. i.e., 5. Control. e.g., 6. Accrual of net profits or losses. 7. Multi-racial and multi-ethnic individuals. 8. Relationship to categories used to determine ethnicity of principal owners. 102(o) Principal Owner 1. Individual. 2. Trustee. 3. Purpose of definition. 102(s) Women-Owned Business 1. General. 2. Purpose of definition. 3. Further clarifications of terms used in the definition of women-owned business. 4. Ownership. i.e., 5. Control. e.g., 6. Accrual of net profits or losses. Section 1002.103—Covered Applications 103(a) Covered Application 1. General. 2. Procedures used. 3. Consistency with subpart A. 4. Solicitations and firm offers of credit. 5. Requests for multiple covered credit transactions at one time. 6. Initial request for a single covered credit transaction that would result in the origination of multiple covered credit transactions. 7. Requests for multiple lines of credit at one time. 8. Duplicate applications. i.e., 9. Changes in whether there is a covered credit transaction. 10. Multiple unaffiliated co-applicants. 11. Refinancings and evaluation, extension, or renewal requests that request additional credit amounts. 103(b) Circumstances That Are Not Covered Applications 1. In general. 2. Reevaluation, extension, or renewal requests that do not request additional credit amounts. 3. Reevaluation, extension, or renewal requests that request additional credit amounts. 4. Reviews or evaluations initiated by the financial institution. 5. Inquiries and prequalification requests. Section 1002.104—Covered Credit Transactions and Excluded Transactions 104(a) Covered Credit Transaction 1. General. 104(b) Excluded Transactions 1. Factoring. 2. Leases. 3. Consumer-designated credit. 4. Credit transaction purchases, purchases of an interest in a pool of credit transactions, and purchases of a partial interest in a credit transaction. 104(b)(1) Trade Credit 1. General. 2. Trade credit under subpart A. 104(b)(9) Small Dollar Business Credit Transactions 1. General. 2. Inflation adjustment methodology. e.g., 3. Substitute for CPI-U. Section 1002.105—Covered Financial Institutions and Exempt Institutions 105(a) Financial Institution 1. Examples. 2. Motor vehicle dealers. 105(b) Covered Financial Institution 1. Preceding calendar year. 2. Origination threshold. 3. Counting originations when multiple financial institutions are involved in originating a covered credit transaction. 4. Counting originations after adjustments to the gross annual revenue threshold due to inflation. 5. Reevaluation, extension, or renewal requests, as well as credit line increases and other requests for additional credit amounts. 6. Annual consideration. 7. Merger or acquisition—coverage of surviving or newly formed institution. 8. Merger or acquisition—coverage specific to the calendar year of the merger or acquisition. i. Two institutions that are not covered financial institutions merge. The surviving or newly formed institution meets all of the requirements necessary to be a covered financial institution. No data are required to be compiled, maintained, or reported for the calendar year of the merger (even though the merger creates an institution that meets all of the requirements necessary to be a covered financial institution). ii. A covered financial institution and an institution that is not covered merge. The covered financial institution is the surviving institution, or a new covered financial institution is formed. For the calendar year of the merger, data are required to be compiled, maintained, and reported for covered applications from the covered financial institution and is optional for covered applications from the financial institution that was previously not covered. iii. A covered financial institution and an institution that is not covered merge. The institution that is not covered is the surviving institution and remains not covered after the merger, or a new institution that is not covered is formed. For the calendar year of the merger, data are required to be compiled and maintained (and subsequently reported) for covered applications from the previously covered financial institution that took place prior to the merger. After the merger date, compiling, maintaining, and reporting data is optional for applications from the institution that was previously covered for the remainder of the calendar year of the merger. iv. Two covered financial institutions merge. The surviving or newly formed financial institution is a covered financial institution. Data are required to be compiled and maintained (and subsequently reported) for the entire calendar year of the merger. The surviving or newly formed financial institution files either a consolidated submission or separate submissions for that calendar year. 9. Foreign applicability. 10. Voluntary collection and reporting. Section 1002.106—Business and Small Business 106(b) Small Business Definition 106(b)(1) Small Business 1. Change in determination of small business status—business is ultimately not a small business. 2. Change in determination of small business status—business is ultimately a small business. 3. Applicant's representations regarding gross annual revenue; inclusion of affiliate revenue; updated or verified information. 4. Multiple unaffiliated co-applicants—size determination. 106(b)(2) Inflation Adjustment 1. Inflation adjustment methodology. e.g., 2. Substitute for CPI-U. Section 1002.107—Compilation of Reportable Data 107(a) Data Format and Itemization 1. General. i. A covered financial institution reports these data even if the credit originated pursuant to the reported application was subsequently sold by the institution. ii. A covered financial institution annually reports data for covered applications for which final action was taken in the previous calendar year. iii. A covered financial institution reports data for a covered application on its small business lending application register for the calendar year during which final action was taken on the application, even if the institution received the application in a previous calendar year. 2. Free-form text fields. 3. Filing Instructions Guide. https://www.consumerfinance.gov/data-research/small-business-lending/filing-instructions-guide/. 4. Additional data point response options. 107(a)(1) Unique Identifier 1. Unique within the financial institution. 2. Does not include directly identifying information. 107(a)(2) Application Date 1. Consistency. 2. Application received. 3. Indirect applications. 4. Safe harbor. 107(a)(5) Credit Type 1. Reporting credit product—in general. i. Term loan—unsecured. ii. Term loan—secured. iii. Line of credit—unsecured. iv. Line of credit—secured. v. Credit card account, not private-label. vi. Private-label credit card account. vii. [Reserved] viii. [Reserved] ix. Other. x. Not provided by applicant and otherwise undetermined. 2. Credit card account, not private-label. 3. Private-label credit card account. 4. Credit product not provided by the applicant and otherwise undetermined. 5. Reporting credit product involving counteroffers. 6. [Reserved] 7. Guarantees. i. Personal guarantee—owner(s). ii. Personal guarantee—non-owner(s). iii. SBA guarantee—7(a) program. iv. SBA guarantee—504 program. v. SBA guarantee—other. vi. USDA guarantee. vii. FHA insurance. viii. Bureau of Indian Affairs guarantee. ix. Other Federal guarantee. x. State government guarantee. xi. Local government guarantee. xii. Other. xiii. No guarantee. 8. Loan term. 107(a)(5) Credit Type 1. Reporting credit product—in general. i. Term loan—unsecured. ii. Term loan—secured. iii. Line of credit—unsecured. iv. Line of credit—secured. v. Credit card account, not private-label. vi. Private-label credit card account. vii. [Reserved] viii. [Reserved] ix. Other. x. Not provided by applicant and otherwise undetermined. 2. Credit card account, not private-label. 3. Private-label credit card account. 4. Credit product not provided by the applicant and otherwise undetermined. 5. Reporting credit product involving counteroffers. 6. [Reserved] 7. Guarantees. i. Personal guarantee—owner(s). ii. Personal guarantee—non-owner(s). iii. SBA guarantee—7(a) program. iv. SBA guarantee—504 program. v. SBA guarantee—other. vi. USDA guarantee. vii. FHA insurance. viii. Bureau of Indian Affairs guarantee. ix. Other Federal guarantee. x. State government guarantee. xi. Local government guarantee. xii. Other. xiii. No guarantee. 8. Loan term. 107(a)(6) Credit Purpose 1. General. i. Purchase, construction/improvement, or refinance of non-owner-occupied real property. ii. Purchase, construction/improvement, or refinance of owner-occupied real property. iii. Purchase, refinance, or rehabilitation/repair of motor vehicle(s) (including light and heavy trucks). iv. Purchase, refinance, or rehabilitation/repair of equipment. v. Working capital (includes inventory or floor planning). vi. Business start-up. vii. Business expansion. viii. Business acquisition. ix. Refinance existing debt (other than refinancings listed above). x. Line increase. xi. Overdraft. xii. Other. xiii. Not provided by applicant and otherwise undetermined. xiv. Not applicable. 2. More than one purpose. 3. “Other” credit purpose. 4. Credit purpose not provided by applicant and otherwise undetermined. 5. Not applicable. 6. Collecting credit purpose. 7. Owner-occupied real property. 8. Overdraft. 107(a)(7) Amount Applied For 1. Initial amount requested. 2. No amount requested. 3. Firm offers. 4. Additional amounts on an existing account. 5. Initial amount otherwise undetermined. 107(a)(8) Amount Approved or Originated 1. General. 2. Multiple approval amounts. 3. Amount approved or originated—closed-end credit transaction. 4. Amount approved or originated—refinancing. 5. Amount approved or originated—counteroffer. 6. Amount approved or originated—existing accounts. 107(a)(9) Action Taken 1. General. i. Originated. ii. Approved but not accepted. iii. Denied. iv. Withdrawn by the applicant. v. Incomplete. 2. Treatment of counteroffers. 3. Treatment of rescinded transactions. 4. Treatment of pending applications. 5. Treatment of conditional approvals. i. Conditional approval—denial. ii. Conditional approval—incompleteness. iii. Conditional approval—approved but not accepted. iv. Conditional approval—withdrawn by the applicant. 107(a)(10) Action Taken Date 1. Reporting action taken date for denied applications. 2. Reporting action taken date for applications withdrawn by applicant. 3. Reporting action taken date for applications that are approved but not accepted. 4. Reporting action taken date for originated applications. 5. Reporting action taken date for incomplete applications. 107(a)(13) Census Tract 1. General. i. Proceeds address. ii. Main office or headquarters address. iii. Another address or location. iv. Type of address used. 2. Financial institution discretion. 3. Address or location not provided by applicant and otherwise undetermined. 4. Safe harbor. 107(a)(14) Gross Annual Revenue 1. Collecting gross annual revenue. What was the gross annual revenue of the business applying for credit in its last full fiscal year? Gross annual revenue is the amount of money the business earned before subtracting taxes and other expenses. You may provide gross annual revenue calculated using any reasonable method. 2. Gross annual revenue not provided by applicant and otherwise undetermined. 3. Affiliate revenue. 4. Gross annual revenue for a startup business. 107(a)(15) NAICS Code 1. General. 2. NAICS not provided by applicant and otherwise undetermined. 3. Safe harbor. 107(a)(17) Time in Business 1. Collecting time in business. i. If a financial institution collects or otherwise obtains the number of years an applicant has been in business as part of its procedures for evaluating an application for credit, it reports the time in business in whole years, rounded down to the nearest whole year. ii. If a financial institution does not collect time in business as described in comment 107(a)(17)-1.i, but as part of its procedures determines whether or not the applicant's time in business is less than two years, it reports the applicant's time in business as either less than two years or two or more years in business. iii. If a financial institution does not collect time in business as part of its procedures for evaluating an application for credit as described in comments 107(a)(17)-1.i or .ii, the financial institution complies with § 1002.107(a)(17) by asking the applicant whether it has been in existence for less than two years or two or more years and reporting the information provided by the applicant accordingly. 2. Time in business collected as part of the financial institution's procedures for evaluating an application for credit. 3. Time in business not provided by applicant and otherwise undetermined. 107(a)(18) Minority-Owned and Women-Owned Business Statuses 1. General. i.e., 2. Definitions. 3. Combining questions. 4. Notices. 5. Maintaining the record of an applicant's response regarding minority-owned and women-owned business statuses separate from the application. 6. Minority-owned and/or women-owned business statuses not provided by applicant. 7. Applicant declines to provide information about minority-owned and/or women-owned business statuses. 8. Conflicting responses provided by applicants. 9. No verification of business statuses. 107(a)(19) Ethnicity, Race, and Sex of Principal Owners 1. General. i.e., 2. Definition of principal owner. 3. Combining questions. 4. Notices. 5. Maintaining the record of an applicant's responses regarding principal owners' ethnicity, race, and sex separate from the application. See 6. Ethnicity, race, or sex of principal owners not provided by applicant. 7. Applicant declines to provide information about a principal owner's ethnicity, race, or sex. 8. Conflicting responses provided by applicant. 9. No verification of ethnicity, race, and sex of principal owners. 10. Reporting for fewer than four principal owners. 11. Previously collected ethnicity, race, and sex information. 12. Guarantors. 13. Ethnicity. Aggregate categories. A. Hispanic or Latino. B. Not Hispanic or Latino. 14. Race. Aggregate categories. A. American Indian or Alaska Native. B. Asian. C. Black or African American. D. Native Hawaiian or Other Pacific Islander. E. White. ii. [Reserved] iii. Selecting multiple categories. 15. Sex. 16. Ethnicity, race, and sex information requested orally. i. [Reserved] ii. More than one principal owner. 107(a)(20) Number of Principal Owners 1. General. 2. Number of principal owners provided by applicant; verification of number of principal owners. 3. Number of principal owners not provided by applicant and otherwise undetermined. 107(b) Reliance on and Verification of Applicant-Provided Data 1. Reliance on information provided by an applicant or appropriate third-party sources. 107(c) Time and Manner of Collection 107(c)(1) In General 1. Procedures. 2. Latitude to design procedures. 3. Applicant-provided data. 4. Collecting applicant-provided data without a direct request to the applicant. 5. Data updated by the applicant. 107(c)(2) Applicant-Provided Data Collected Directly From the Applicant 1. In general. 2. Specific components. Timing of initial collection attempt. ii. The request for applicant-provided data is prominently displayed or presented. iii. [Reserved] iv. The applicant can easily provide a response. v. Multiple requests for applicant-provided data. 107(d) Previously Collected Data 1. In general. 2. Data that can be reused. 3. Previously reported data without a substantive response. 4. Updated data. 5. Collection within the preceding 36 months. 6. Reason to believe data are inaccurate. 7. Collection of gross annual revenue in the same calendar year. 8. Time in business. i. If a financial institution previously collected data on a prior covered application that the applicant has been in business for four years, and then seeks to reuse that data for a subsequent covered application submitted one year later, it must update the data to reflect that the applicant has been in business for five years. ii. If a financial institution previously collected data on a prior covered application that the applicant had been in business less than two years (and was not aware of the business's actual length of time in business at the time), and then seeks to reuse that data for a subsequent covered application submitted 18 months later, the financial institution reports time in business on the subsequent covered application as over two years in business. 9. Minority-owned business status, women-owned business status, and principal owners' ethnicity, race, and sex. Section 1002.108—Firewall 108(a) Definitions 1. Involved in making any determination concerning a covered application from a small business. General. ii. Examples of activities that do not constitute being involved in making a determination concerning a covered application from a small business. A. Developing policies and procedures, designing or programming computer or other systems, or conducting marketing. B. Discussing credit products, loan terms, or loan requirements with a small business before it submits a covered application. C. Making or participating in a decision after the financial institution has taken final action on the covered application, such as a decision about servicing or collecting a covered credit transaction. D. Using a check box form to confirm whether an applicant has submitted all necessary documents or handling a minor or clerical matter during the application process, such as suggesting or selecting a time for an appointment with an applicant. E. Gathering information (including information collected pursuant to § 1002.107(a)(18) or (19)) and forwarding the information or a covered application to other individuals or entities. F. Reviewing previously collected data to determine if it can be reused for a later covered application pursuant to § 1002.107(d). iii. Examples of activities that constitute being involved in making a determination concerning a covered application from a small business. A. Making or participating in a decision to approve or deny a specific covered application. This includes, but is not limited to, making or participating in a decision that an applicant does not satisfy one or more of the requirements for the covered credit transaction for which it has applied. B. Making or participating in a decision regarding the reason(s) for denial of a covered application. C. Making or participating in a decision that a guarantor or collateral is required in order to approve a specific covered application. D. Making or participating in a decision regarding the credit amount or credit limit that will be approved for a specific covered application. E. Making or participating in a decision to set one or more of the other terms that will be offered for a specific covered credit transaction. This includes, but is not limited to, making or participating in a decision regarding the interest rate, the loan term, or the payment schedule that will be offered for a specific covered credit transaction. F. Making or participating in a decision regarding a counteroffer made to a specific applicant, including a decision regarding the terms of such a counteroffer. G. Recommending that another decision maker approve or deny a specific covered application, provide a specific reason for denying a covered application, require a guarantor or collateral in order to approve a covered application, approve a credit amount or credit limit for a covered credit transaction, set one or more other terms for a covered credit transaction, make a counteroffer regarding a covered application, or set a specific term for such a counteroffer. 2. Should have access. General. ii. When a group of employees or officers should have access. iii. Making a determination regarding who should have access. 108(b) Prohibition on Access to Certain Information 1. Scope of persons subject to the prohibition. 2. Scope of information that cannot be accessed when the prohibition applies to an employee or officer. ii. Information that can be accessed when the prohibition applies. 108(c) Exception to the Prohibition on Access to Certain Information 1. General. 2. Applying the exception to a specific employee or officer or group of similarly situated employees or officers. 108(d) Notice 1. General. 2. Content of the required notice. 3. Timing for providing the notice. Section 1002.109—Reporting of Data to the Bureau 109(a) Reporting to the Bureau 109(a)(2) Reporting by Subsidiaries 1. Subsidiaries. 109(a)(3) Reporting Obligations Where Multiple Financial Institutions Are Involved in a Covered Credit Transaction 1. General. i. A financial institution shall report the action that it takes on a covered application, whether or not the covered credit transaction closed in the financial institution's name and even if the financial institution used underwriting criteria supplied by another financial institution. However, where it is necessary for more than one financial institution to make a credit decision in order to approve a single covered credit transaction, only the last financial institution with authority to set the material terms of the covered credit transaction is required to report. Setting the material terms of the covered credit transaction include, for example, selecting among competing offers, or modifying pricing information, amount approved or originated, or repayment duration. In this situation, the determinative factor is not which financial institution actually made the last credit decision prior to closing, but rather which financial institution last had the authority for setting the material terms of the covered credit transaction prior to closing. Whether a financial institution has taken action for purposes of § 1002.109(a)(3) and comment 109(a)(3)-1 is not relevant to, and is not intended to repeal, abrogate, annul, impair, or interfere with, section 701(d) (15 U.S.C. 1691(d)) of the Act, § 1002.9, or any other provision within subpart A of this part. ii. A financial institution takes action on a covered application for purposes of § 1002.109(a)(3) if it denies the application, originates the application, approves the application but the applicant did not accept the transaction, or closes the file or denies for incompleteness. The financial institution must also report the application if it was withdrawn. For reporting purposes, it is not relevant whether the financial institution receives the application directly from the applicant or indirectly through another party, such as a broker, or (except as otherwise provided in comment 109(a)(3)-1.i) whether another financial institution also reviews and reports an action taken on a covered application involving the same credit transaction. iii. Where it is necessary for more than one financial institution to make a credit decision in order to approve a single covered credit transaction and where more than one financial institution denies the application or otherwise does not approve the application, the reporting financial institution (the last financial institution with authority to set the material terms of the covered credit transaction) shall have a consistent procedure for determining how it reports inconsistent or differing data points for purposes of subpart B of this part. For example, Financial Institution A is the reporting entity because it has the last authority to set the material credit terms. Financial Institution A sends the application to Financial Institution B and Financial Institution C for review, but both Financial Institution B and Financial Institution C deny the application. Based on these denials, Financial Institution A follows suit and denies the application. 2. Examples. i. Financial Institution A received a covered application from an applicant and approved the application before closing the covered credit transaction in its name. Financial Institution A was not acting as Financial Institution B's agent. Financial Institution B later purchased the covered credit transaction from Financial Institution A. Financial Institution A was not acting as Financial Institution B's agent. Financial Institution A reports the application. Financial Institution B has no reporting obligation for this transaction. ii. Financial Institution A received a covered application from an applicant. If approved, the covered credit transaction would have closed in Financial Institution B's name. Financial Institution A denied the application without sending it to Financial Institution B for approval. Financial Institution A was not acting as Financial Institution B's agent. Since Financial Institution A took action on the application, Financial Institution A reports the application as denied. Financial Institution B does not report the application. iii. Financial Institution A reviewed a covered application and made a credit decision to approve it using the underwriting criteria provided by a Financial Institution B. Financial Institution B did not review the application and did not make a credit decision prior to closing. Financial Institution A was not acting as Financial Institution B's agent. Financial Institution A reports the application. Financial Institution B has no reporting obligation for this application. iv. Financial Institution A reviewed and made the credit decision on a covered application based on the criteria of a third-party insurer or guarantor (for example, a government or private insurer or guarantor). Financial Institution A reports the action taken on the application. v. Financial Institution A received a covered application from an applicant and forwarded that application to Financial Institution B. Financial Institution B reviewed the application and made a credit decision approving the application prior to closing. The covered credit transaction closed in Financial Institution A's name. Financial Institution B purchased the covered credit transaction from Financial Institution A after closing. Financial Institution B was not acting as Financial Institution A's agent. Since Financial Institution B made the credit decision prior to closing, and Financial Institution A's approval was not necessary for the credit transaction, Financial Institution B reports the origination. Financial Institution A does not report the application. Assume the same facts, except that Financial Institution B reviewed the application before the covered credit transaction would have closed, but Financial Institution B denied the application. Financial Institution B reports the application as denied. Financial Institution A does not report the application because it did not take an action on the application. If, under the same facts, the application was withdrawn before Financial Institution B made a credit decision, Financial Institution B would report the application as withdrawn and Financial Institution A would not report the application for the same reason. vi. Financial Institution A received a covered application and forwarded it to Financial Institutions B and C. Financial Institution A made a credit decision, acting as Financial Institution D's agent, and approved the application. Financial Institutions B and C are not working together with Financial Institutions A or D, or with each other, and are solely responsible for setting the terms of their own credit transactions. Financial Institution B made a credit decision approving the application, and Financial Institution C made a credit decision denying the application. The applicant did not accept the covered credit transaction from Financial Institution D. Financial Institution D reports the application as approved but not accepted. Financial Institution A does not report the application, because it was acting as Financial Institution D's agent. The applicant accepted the offer of credit from Financial Institution B, and credit was extended. Financial Institution B reports the application as originated. Financial Institution C reports the application as denied. vii. Financial Institution A received a covered application and made a credit decision to approve it using the underwriting criteria provided by Financial Institution B. Financial Institution A was not acting as Financial Institution B's agent. Financial Institution A forwarded the application to Financial Institution B. Financial Institution B reviewed the application and made a credit decision approving the application prior to closing. Financial Institution A makes a credit decision on the application and modifies the credit terms (the interest rate and repayment term) offered by Financial Institution B. The covered credit transaction reflecting the modified terms closes in Financial Institution A's name. Financial Institution B purchases the covered credit transaction from Financial Institution A after closing. As the last financial institution with the authority for setting the material terms of the covered credit transaction, Financial Institution A reports the application as originated. Financial Institution B does not report the origination because it was not the last financial institution with the authority to set the material terms on the application. If, under the same facts, Financial Institution A did not modify the credit terms offered by Financial Institution B, Financial Institution A still reports the application as originated because it was still the last financial institution with the authority for setting the material terms, even if it chose not to so do in a particular instance. Financial Institution B does not report the origination. viii. Financial Institution A received a covered application and forwarded it to Financial Institutions B, C, and D. Financial Institution A was not acting as anyone's agent. Financial Institution B and C reviewed the application and made a credit decision approving the application and Financial Institution D reviewed the application and made a credit decision denying the application. Prior to closing, Financial Institution A makes a credit decision on the application by deciding to offer to the applicant the credit terms offered by Financial Institution B and does not convey to the applicant the credit terms offered by Financial Institution C. The applicant does not accept the covered credit transaction. As the last financial institution with the authority for setting the material terms of the covered credit transaction, Financial Institution A reports the application as approved but not accepted. Financial Institutions B, C, and D do not report the application because they were not the last financial institution with the authority for setting the material terms of the covered credit transaction. Assume the same facts, except the applicant accepts the terms of the covered credit transaction from Financial Institution B as offered by Financial Institution A. The covered credit transaction closes in Financial Institution A's name. Financial Institution B purchases the transaction after closing. Here, Financial Institution A reports the application as originated. Financial Institutions B, C, and D do not report the application because they were not the last financial institution responsible for setting the material terms of the covered credit transaction. ix. Financial Institution A receives a covered application and approves it, and then Financial Institution A elects to organize a loan participation agreement where Financial Institutions B and C agree to purchase a partial interest in the covered credit transaction. Financial Institution A reports the application. Financial Institutions B and C have no reporting obligation for this application. x. Financial Institution A purchases an interest in a pool of covered credit transactions, such as credit-backed securities or real estate investment conduits. Financial Institution A does not report this purchase. 3. Agents. 109(b) Financial Institution Identifying Information 1. Changes to financial institution identifying information. Paragraph 109(b)(4) 1. Federal prudential regulator. Federal prudential regulator Paragraph 109(b)(6) 1. Legal Entity Identifier (LEI). Paragraph 109(b)(7) 1. RSSD ID number. Paragraph 109(b)(8) 1. Immediate parent entity. 2. Top-holding parent entity. 3. LEI. 4. RSSD ID numbers. Paragraph 109(b)(9) 1. Type of financial institution. i. Bank or savings association. ii. Minority depository institution. iii. Credit union. iv. Nondepository institution. v. Community development financial institution (CDFI). vi. Other nonprofit financial institution. vii. [Reserved]. viii. Government lender. ix. Commercial finance company. x. Equipment finance company. xi. Industrial loan company. xii. Online lender. xiii. Other. 2. Use of “other” for type of financial institution. 3. Additional types of financial institution. Paragraph 109(b)(10) 1. Financial institutions that voluntarily report covered applications under subpart B of this part. Section 1002.110—Publication of Data and Other Disclosures 110(c) Statement of Financial Institution's Small Business Lending Data Available on the Bureau's Website 1. Statement. Small Business Lending Data Notice Data about our small business lending are available online for review at the Consumer Financial Protection Bureau's (CFPB's) website at https://www.consumerfinance.gov/data-research/small-business-lending/. The data show the geographic distribution of our small business lending applications; information about our loan approvals and denials; and demographic information about the principal owners of our small business applicants. The CFPB may delete or modify portions of our data prior to posting it if doing so would advance a privacy interest. Small business lending data for many other financial institutions are also available at this website. 2. Website. 3. Revised location for publicly available data. Section 1002.111—Recordkeeping 111(a) Record Retention 1. Evidence of compliance. 2. Record retention for creditors under § 1002.5(a)(4)(vii) and (viii). 111(b) Certain Information Kept Separate From the Rest of the Application 1. Separate from the application. 2. Number of principal owners. 111(c) Limitation on Personally Identifiable Information in Certain Records Retained Under This Section 1. Small business lending application register. 2. Examples. 3. Other records. 4. Name and business contact information for submission. Section 1002.112—Enforcement 112(b) Bona Fide Errors 1. Tolerances for bona fide errors. 2. Tolerances and data fields. https://www.consumerfinance.gov/data-research/small-business-lending/filing-instructions-guide/. 3. Tolerances and safe harbors. 112(c) Safe Harbors 1. Information from a Federal agency—census tract. 2. Applicability of NAICS code safe harbor. 3. Incorrect determination of small business status, covered credit transaction, or covered application—examples. Section 1002.114—Effective Date, Compliance Date, and Special Transition Rules 114(b) Compliance Date 1. Application of initial compliance date. 2. [Reserved] 3. [Reserved] 4. Examples. i. Financial Institution A originated 3,000 covered credit transactions for small businesses in calendar year 2026, and 3,000 in calendar year 2027. Financial Institution A has a compliance date of January 1, 2028. ii. [Reserved] iii. [Reserved] iv. Financial Institution D originated 990 covered credit transactions to small businesses in calendar year 2026, 1,020 in calendar year 2027, and 990 in calendar years 2028 and 2029. Because Financial Institution D did not originate at least 1,000 covered credit transactions for small businesses in each of 2026 and 2027, it is not subject to the initial compliance date set forth in § 1002.114(b)(1). Because Financial Institution D did not originate at least 1,000 covered credit transactions for small businesses in subsequent consecutive calendar years, it is not a covered financial institution under § 1002.105(b) and is not required to comply with the rule in 2029 or 2030. v. [Reserved] vi. Financial Institution F originated 990 covered credit transactions for small businesses in calendar year 2026, and 1,020 in 2027, 2028, and 2029. Because Financial Institution F did not originate at least 1,000 covered credit transactions for small businesses in each of 2026 and 2027, it is not subject to the initial compliance date set forth in § 1002.114(b)(1). Because Financial Institution F originated at least 1,000 covered credit transactions for small businesses in subsequent calendar years, § 1002.114(b)(4), which cross-references § 1002.105(b), applies to Financial Institution F. Because Financial Institution F originated at least 1,000 covered credit transactions for small businesses in each of 2027 and 2028, it is a covered financial institution under § 1002.105(b) and is required to comply with the rule beginning January 1, 2029. 114(c) Special Transition Rules 1. Collection of certain information prior to a financial institution's compliance date. 2. Transition rule for applications received prior to a compliance date but final action is taken after a compliance date. 3. Has readily accessible the information needed to determine small business status. 4. Does not have readily accessible the information needed to determine small business status. 5. Reasonable method to estimate the number of originations. i. A financial institution may comply with § 1002.114(c)(2) by determining the small business status of covered credit transactions by asking every applicant, prior to the closing of approved transactions, to self-report whether it had gross annual revenue for its preceding fiscal year of $1 million or less, during the period October 1 through December 31, 2026. The financial institution may annualize the number of covered credit transactions it originates to small businesses from October 1 through December 31, 2026, by quadrupling the originations for this period, and apply the annualized number of originations to both calendar years 2026 and 2027. ii. A financial institution may comply with § 1002.114(c)(2) by asking a representative sample of applicants for covered credit transactions whether they are small businesses. iii. A financial institution may comply with § 1002.114(c)(2) by using another methodology provided that such methodology is reasonable and documented in writing. 6. Examples. i. Prior to July 1, 2026, Financial Institution A did not collect gross annual revenue or other information that would allow it to determine the small business status of the businesses for whom it originated covered credit transactions in calendar year 2026. Financial Institution A chose to use the methodology set out in comment 114(c)-5.i and as of July 1, 2026, began to collect information on gross annual revenue as defined in § 1002.107(a)(14) for its covered credit transactions originated for businesses. Using this information, Financial Institution A determined that it had originated 750 covered credit transactions for businesses that were small as defined in § 1002.106. On an annualized basis, Financial Institution A originated 3,000 covered credit transactions for small businesses (750 originations * 4 = 3,000 originations per year). Applying this annualized figure of 3,000 originations to both calendar years 2026 and 2027, Financial Institution A is subject to the initial compliance date set forth in § 1002.114(b)(1). ii. Prior to July 1, 2026, Financial Institution B collected gross annual revenue information for some applicants for business credit, but such information was only noted in its paper loan files. Financial Institution B thus does not have reasonable access to information that would allow it to determine the small business status of the businesses for whom it originated covered credit transactions for the first half of calendar year 2026. Financial Institution B chose to use the methodology set out in comment 114(c)-5.i, and as of October 1, 2026, Financial Institution B began to ask all businesses for whom it was closing covered credit transactions if they had gross annual revenues in the preceding fiscal year of $1 million or less. Using this information, Financial Institution B determined that it had originated 850 covered credit transactions for businesses that were small as defined in § 1002.106. On an annualized basis, Financial Institution B originated 3,400 covered credit transactions for small businesses (850 originations * 4 = 3,400 originations per year). Applying this estimated figure of 3,400 originations to both calendar years 2026 and 2027, Financial Institution B is subject to the initial compliance date set forth in § 1002.114(b)(1). iii. [Reserved] iv. Financial Institution D did not collect gross annual revenue or other information that would allow it to determine the small business status of the businesses for whom it originated covered credit transactions in calendar years 2026 and 2027. Financial Institution D determined that it had originated 3,000 total covered credit transactions for businesses in each of 2026 and 2027. Applying the methodology specified in comment 114(c)-5.ii, Financial Institution D assumed that all 3,000 covered credit transactions originated in each of 2026 and 2027 were to small businesses. On that basis, Financial Institution D is subject to the initial compliance date set forth in § 1002.114(b)(1). v. [Reserved] vi. Financial Institution F does not have readily accessible gross annual revenue or other information that would allow it to determine the small business status of the businesses for whom it originated covered credit transactions in calendar years 2026 and 2027. Financial Institution F determined that it had originated 480 total covered credit transactions for businesses in 2026 and 550 total covered credit transactions for businesses in 2027. Applying the methodology set out in comment 114(c)-5.ii, Financial Institution F assumed that all such transactions originated in 2026 and 2027 were originated for small businesses. On that basis, Financial Institution F is not subject to the initial compliance date set forth in § 1002.114(b)(1). vii. Financial Institution G chose to estimate its originations for 2025 and 2026 (rather than 2026 and 2027), as permitted by § 1002.114(c)(3), and does not have readily accessible gross annual revenue or other information that would allow it to determine the small business status of the businesses for whom it originated covered credit transactions in either of those calendar years. Financial Institution G chose to use the methodology set out in comment 114(c)-5.i, and as of October 1, 2025, Financial Institution G began to ask all businesses for whom it was closing covered credit transactions if they had gross annual revenue in the preceding fiscal year of $1 million or less. Using this information, Financial Institution G determined that it had originated 700 covered credit transactions during that period for businesses that were small as defined in § 1002.106. On an annualized basis, Financial Institution G originated 2,800 covered credit transactions for small businesses (700 originations * 4 = 2,800 originations per year). Applying this estimated figure of 2,800 originations to both calendar years 2025 and 2026, Financial Institution G is subject to the initial compliance date set forth in § 1002.114(b)(1). Appendix C—Sample Notification Forms 1. Form C-9. i. A telephone number that applicants may call to leave their name and the address to which a copy of the appraisal or other written valuation should be sent. ii. A notice of the cost the applicant will be required to pay the creditor for the appraisal or other valuation. [76 FR 79445, Dec. 21, 2011, as amended at 78 FR 7248, Jan. 31, 2013; 82 FR 45695, Oct. 2, 2017; 88 FR 35536, May 31, 2023; 89 FR 55029, July 3, 2024; 90 FR 25880, June 18, 2025; 90 FR 47520, Oct. 2, 2025; 91 FR 23609, May 1, 2026; 91 FR 21669, Apr. 22, 2026]

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