John Zasada, Compliance Consulting Director, Financial Institutions Group

On June 16, 2020, the Consumer Financial Protection Bureau (CFPB) released the Consumer Reporting FAQs Related to the CARES Act and COVID-19 Pandemic to address the compliance responsibilities of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) amendments to the Fair Credit Reporting Act and Regulation V.

Detailed in the FAQ document was the explanation of the implications related to the previously released Statement on Supervisory and Enforcement Priorities Regarding the Fair Credit Reporting Act and Regulation V in Light of the CARES Act, as well as the enforcement efforts pertaining to furnishers reporting current certain accounts for consumers affected by the pandemic.

The FAQs state the CARES Act requires furnishers to provide accommodations to consumers impacted by the pandemic for two types of loans.

    1. Forbearance for consumers with federally backed mortgage loans from their servicer upon request and the borrower’s attestation of a financial hardship due to the COVID-19 emergency.
    2. Automatic suspension of principal and interest payments on federally held student loans through Sept.30, 2020.

It also addresses that a furnisher can comply with the requirements of the CARES Act relating to the reporting of accommodations simply by using a special comment code to report a natural or declared disaster or forbearance. It does not that using a special comment code indicating a consumer with an account is impacted by a disaster or that the consumer’s account is in forbearance does not provide consumer reporting agencies with this CARES Act-required information and therefore furnishing a comment code is not a substitute for complying with the requirements.

For more information on the CARES Act’s impact on the Fair Credit Reporting Act and Regulation V requirements, contact Doeren Mayhew’s regulatory compliance specialists.