Happy day before 4th!! I have a student loan with my college. TU was reporting lateness that I disputed. It came back verified. The college then pulled my EFX report. Apparently the only two CRA's they use are TU and EFX. They are telling me that when they recieve a dispute, that they have permissible purpose to do hard pulls on both reports. It seems shady to me, but when I searched the board I cand get the Fed Regs to really address the purpose. I mean, they are telling me that all they can do are hard pulls. No recoding, nothing. Is this accurate?
I do. I have been paying them on time for quite a while now. I just am wonderifg if as a matter of course, they can pull a report form both CRA's when I only disputed with ONE.
I asked questions too fast, but there is some debate whether in a closed end installment loan where terms cannot be changed do they have a PP to look at your report. That being said: (F) otherwise has a legitimate business need for the information (i) in connection with a business transaction that is initiated by the consumer; or Would they have a legitimate business need?
Re: Re: Inquiry Shenanigans!! That is the question I have. If i dispute the lateness, as i did, are they allowed to pull CRA reports from CRA's I did NOT dispute with, to investigate? The loan was started back in 98, never had any lates or anything.
The dispute does not give Permissible Purpose to pull a hard inquiry. As far as the college having permissible Purpose to pull a hard (or soft) inquiry, I refer you to the FTC Greenblatt and Gowen Letters, which I summarize below: Greenblatt Scenario: â??An early dispute resolution conference is scheduled with each brokerage client. Prior to the meetings, and with civil litigation seeming imminent, the legal department at the brokerage firm obtains the consumer credit report of every complainant.â? Operative statement â?? active dispute, and prior to and in anticipation of litigation FTC Opinion: â??Neither the dispute resolution conference, the imminent threat of civil litigation, nor the desire to craft a settlement offer provide the brokerage firm with a permissible purpose to obtain a brokerage client's consumer report under Section 604.â? Gowen Scenario: â??Your questions raise the issue of whether a creditor in a closed end credit transaction may exploit consumer reports obtained for "review" purposesâ? Operative Statement: CLOSED end transaction (terms not subject to change, like a Credit Card, but are contractually fixed) FTC Opinion: "The terms of a closed-end credit transaction are predetermined and generally may not be changed unilaterally by the creditor unless the contract expressly provides for such action (e.g., in the event of default). Therefore, the creditor is unlikely to have a reason to consider "whether to retain or modify current account terms" and, thus, would not have any routine need to procure consumer reports to "review" its accounts. Second, the credit bureau must, pursuant to Section 607(a), require the creditor to "certify the purposes for which the information is sought, and certify that the information will be used for no other purpose." (emphasis added). Because Section 604(a) provides no authority for a creditor (or any party) to use a consumer report for marketing purposes,(4) a creditor would violate its certification by using an existing report in such a manner." For the full text of the Greenblatt and Gowen Letters go to the FTC web site www.ftc.gov Sounds like you have grounds to sue the college for non-PP access to your CRA file.
Damn dude. I appreciate the answer, you rock, and that was just type of info I was looking for! I am now printing out those opinion letters and will be pursuing this further. I talked with a rep of my former college today and she say that they handle all disputes this way. So I am now a champion of every student who has a loan with them. My course is set. My cause is true. Thanks bunches!
Re: Re: Inquiry Shenanigans!! If they violate FCRA by SOP you may want to take that information to a lawyer and look into a CLASS ACTION. OR, (and I like this better) subpoena as part of your pre-trial discovery a list of all students they have done this with over the past year FCRA has a 1 year Statute of limitations) and notify THEM of THEIR right to sue the college. That statement of SOP could become a very expensive slip of the tongue.
Re: Re: Re: Re: Inquiry Shenanigans!! Standard Operating Procedure, meaning FCRA means nothing to them, they will do whatever they want (and pay the price for it)
<bump> Thanks for the definition and the help. July will be raining moolah. After all, they did take a bunch.
Shennagin Update <bump> I got this letter in the mail to day from the college. "...On May 27, 2003 we received a Consumer Dispute Verification from TransUnion. In order to complete the verification form a credit report was ran. By law business are allowed to run credit reports for legitimate business purposes. In this incidence the consumer initiated the legitimate business purpose. You asked if the inquiry could be removed from you credit report, unfortunately, this is not possible." A dispute isn't permissible purpose to pull my report to in essence, 'see what I am talking about'? is it?
Re: Shennagin Update THEY DON'T HAVE TO PULL A CREDIT REPORT TO "SEE" WHAT THEY PUT THERE!!! They have "PP" to "PULL" every day...BUT THEY DON'T EVER HAVE TO PULL A "HARD" they can pull a "SOFT" every day if they want with NO harm done!!! It is a grey area "IF" they have PP to pull in response to your request... WORTH REPEATING...THEY DON'T HAVE TO PULL A CREDIT REPORT TO "SEE" WHAT THEY PUT THERE!!!
Re: Shennagin Update Great!!!! Now you have TWO reasons to sue them. Just refer back to my prior post where I includ ethe FTC Staff Opinion letters. These schmucks never learn.
Re: Shennagin Update Flying - did you read the footnotes to Gowen? 2. In commenting on Senate Bill 650, which contained provisions very similar to the ones enacted as the "Consumer Credit Reporting Reform Act of 1996," the Senate Committee on Banking, Housing, and Urban Affairs stated: Section 603(m) makes it clear that the prescreening provisions of the FCRA do not apply where a consumer report is obtained by a creditor in connection with reviewing or collecting an existing account of the consumer for safety and soundness purposes, even if the creditor subsequently decides to change the credit available to the consumer (emphasis added). S. Rep. No. 104-185 at 33 (1995). Hence, a creditor may obtain consumer reports for the purpose of reviewing its current closed end (or other) credit accounts without having to comply with the FCRA requirements applicable to prescreened transactions.
Re: Shennagin Update jlynn- Yes, I read that but it doesn't apply HERE since the school's purpose for pulling the hard Inquiries is in response to a FCRA dispute, not to verify any compliance with the terms of lending. Seems kinds self-contradictory with the second pull - consumer disputes PP for a pull so the creditor pulls again to verify that they pulled in the first place. So, if the consumer disputes the second pull, doe sthat give the creditor PP to pull a 3rd time? Where does this merry-go-round stop?
Re: Re: Shennagin Update The fact that it is a dispute is irrelevant. They have the right to review an existing account. You should concentrate your efforts as having it re-coded properly. It should be an AR. The CRA may do it if you point out the account to them. Are the lates legitimate? If so, you may want to think twice about how you deal with a long term creditor.
Re: Re: Re: Shennagin Update I think you should re-read the Greenblatt letter. The school has no PP since the terms of teh student loan are not subject to review or change, beinga closed end transaction, and the pull was made as a result of a dispute over what the lender put in the CRA file in the first place, not an AR or a PRM.
Re: Re: Re: Re: Shennagin Update Just to clarify folks. The college was reporting I was late, now this is a loan that I got WAY back in 98 and always paid on time. i disputed the lateness with TU and on the 27th o' May, they pulled my report(hard) to investigate my dispute. I know they have the right to do AR's or review my account 94 times a day if they like. Shoot. I talked to TU and on 2.7.03 they did an AR. My issue is I disputed, they pulled TU and EFX both hard, and said that since they are a college they have the right. *See Letter Above* All I really want is it to be coded correctly, but they tell me that it is impossible. Hope that clears stuff up. Again, you guys, and credit worthy gals ROCK.
Re: Re: Re: Re: Shennagin Update The Greenblatt letter is not applicable in this case. That letter examines the permissibility of pulling a report in preparation for litigation - it is not a business transaction nor a review of a specific account. Also, I wonder how closed student loans really are? My rates changes every July, with my University's new fiscal year. Also, some programs will discount your rate with 24 consecutive on-time payments. I have a sense that all student loans are not created equal AND I'll bet the fine print we all signed gives them permission to review as needed. Talk to the CRA and try to get them to re-code to AR.
