The CFPB issued ten FAQs for industry that address the CARES Act’s credit reporting requirements and other COVID-19-related credit reporting issues.
Several of the FAQs discuss the Bureau’s Policy Statement issued in April 2020 concerning COVID-19 considerations relevant to how the Bureau will exercise its supervisory and enforcement authority regarding FCRA and Regulation V compliance, especially in light of the CARES Act. The first FAQ restates the Policy Statement and two FAQs highlight the Bureau’s enforcement approach, with FAQ 2 confirming that the Bureau is enforcing the CARES Act’s requirements for furnishers and FAQ 3 elaborating on the Bureau’s flexible supervisory and enforcement approach during the COVID-19 pandemic that was set forth in the Policy Statement. The Bureau states that while it indicated it would provide some flexibility to help furnishers and consumer reporting agencies, it did not say in the Statement that it “would give furnishers or consumer reporting agencies an unlimited time beyond the statutory deadlines to investigate disputes before the Bureau would take supervisory or enforcement action.” The Bureau further states that it expects furnishers and consumer reporting agencies to make good faith efforts to investigate disputes as quickly as possible and will “evaluate individually the efforts and circumstances of each furnisher and consumer reporting agency in determining if it made good faith efforts to investigate disputes as quickly as possible.” The Bureau’s discussion suggests that such circumstances will include a furnisher’s or CRA’s size and sophistication.
Other highlights of the FAQs include:
FAQ 6 states that if an account was current before an accommodation, the furnisher, during the accommodation, must continue to report the account as current. If an account was delinquent before an accommodation, the furnisher, during the accommodation, cannot advance the delinquent status. The FAQ gives an example in which a furnisher was reporting a consumer as 30 days past due at the time of the accommodation and states that the furnisher may not report the account as 60 days past due during the accommodation. If the consumer brings the account current during the accommodation, the furnisher must report the account as current. Situations when this could occur include where the accommodation itself brings the account current (such as a modification that resolves amounts past due so that the borrower is no longer considered delinquent) or where the consumer makes past due payments that bring the account current. The FAQ states that CARES Act credit reporting requirements for accommodations do not apply to charged off accounts. FULL ARTICLE