222.73—Content, form, and timing of risk-based pricing notices.
(a) Content of the notice—
(1) In general.
The risk-based pricing notice required by § 222.72(a) or (c) must include:
(i)
A statement that a consumer report (or credit report) includes information about the consumer's credit history and the type of information included in that history;
(ii)
A statement that the terms offered, such as the annual percentage rate, have been set based on information from a consumer report;
(iii)
A statement that the terms offered may be less favorable than the terms offered to consumers with better credit histories;
(iv)
A statement that the consumer is encouraged to verify the accuracy of the information contained in the consumer report and has the right to dispute any inaccurate information in the report;
(v)
The identity of each consumer reporting agency that furnished a consumer report used in the credit decision;
(vi)
A statement that federal law gives the consumer the right to obtain a copy of a consumer report from the consumer reporting agency or agencies identified in the notice without charge for 60 days after receipt of the notice;
(vii)
A statement informing the consumer how to obtain a consumer report from the consumer reporting agency or agencies identified in the notice and providing contact information (including a toll-free telephone number, where applicable) specified by the consumer reporting agency or agencies; and
(viii)
A statement directing consumers to the Web sites of the Federal Reserve Board and Federal Trade Commission to obtain more information about consumer reports.
(i)
A statement that a consumer report (or credit report) includes information about the consumer's credit history and the type of information included in that credit history;
(ii)
A statement that the person has conducted a review of the account using information from a consumer report;
(iii)
A statement that as a result of the review, the annual percentage rate on the account has been increased based on information from a consumer report;
(iv)
A statement that the consumer is encouraged to verify the accuracy of the information contained in the consumer report and has the right to dispute any inaccurate information in the report;
(v)
The identity of each consumer reporting agency that furnished a consumer report used in the account review;
(vi)
A statement that federal law gives the consumer the right to obtain a copy of a consumer report from the consumer reporting agency or agencies identified in the notice without charge for 60 days after receipt of the notice;
(vii)
A statement informing the consumer how to obtain a consumer report from the consumer reporting agency or agencies identified in the notice and providing contact information (including a toll-free telephone number, where applicable) specified by the consumer reporting agency or agencies; and
(viii)
A statement directing consumers to the Web sites of the Federal Reserve Board and Federal Trade Commission to obtain more information about consumer reports.
(b) Form of the notice—
(1) In general.
The risk-based pricing notice required by § 222.72(a), (c), or (d) must be:
(2) Model forms.
A model form of the risk-based pricing notice required by § 222.72(a) and (c) is contained in appendix H-1 of this part. Appropriate use of Model Form H-1 is deemed to comply with the content and form requirements of paragraphs (a)(1) and (b) of this section. A model form of the risk-based pricing notice required by § 222.72(d) is contained in appendix H-2 of this part. Appropriate use of Model Form H-2 is deemed to comply with the content and form requirements of paragraphs (a)(2) and (b) of this section. Use of the model forms is optional.
(c) Timing—
(1) General.
Except as provided in paragraph (c)(3) of this section, a risk-based pricing notice must be provided to the consumer—
(i)
In the case of a grant, extension, or other provision of closed-end credit, before consummation of the transaction, but not earlier than the time the decision to approve an application for, or a grant, extension, or other provision of, credit, is communicated to the consumer by the person required to provide the notice;
(ii)
In the case of credit granted, extended, or provided under an open-end credit plan, before the first transaction is made under the plan, but not earlier than the time the decision to approve an application for, or a grant, extension, or other provision of, credit is communicated to the consumer by the person required to provide the notice; or
(iii)
In the case of a review of credit that has been extended to the consumer, at the time the decision to increase the annual percentage rate (annual percentage rate referenced in § 222.71(n)(1)(ii) in the case of a credit card) based on a consumer report is communicated to the consumer by the person required to provide the notice, or if no notice of the increase in the annual percentage rate is provided to the consumer prior to the effective date of the change in the annual percentage rate (to the extent permitted by law), no later than five days after the effective date of the change in the annual percentage rate.
(2) Application to certain automobile lending transactions.
When a person to whom a credit obligation is initially payable grants, extends, or provides credit to a consumer for the purpose of financing the purchase of an automobile from an auto dealer or other party that is not affiliated with the person, any requirement to provide a risk-based pricing notice pursuant to this subpart is satisfied if the person:
(i)
Provides a notice described in §§ 222.72(a), 222.74(e), or 222.74(f) to the consumer within the time periods set forth in paragraph (c)(1)(i) of this section, § 222.74(e)(3), or § 222.74(f)(4), as applicable; or
(ii)
Arranges to have the auto dealer or other party provide a notice described in §§ 222.72(a), 222.74(e), or 222.74(f) to the consumer on its behalf within the time periods set forth in paragraph (c)(1)(i) of this section, § 222.74(e)(3), or § 222.74(f)(4), as applicable, and maintains reasonable policies and procedures to verify that the auto dealer or other party provides such notice to the consumer within the applicable time periods. If the person arranges to have the auto dealer or other party provide a notice described in § 222.74(e), the person's obligation is satisfied if the consumer receives a notice containing a credit score obtained by the dealer or other party, even if a different credit score is obtained and used by the person on whose behalf the notice is provided.
(3) Timing requirements for contemporaneous purchase credit.
When credit under an open-end credit plan is granted, extended, or provided to a consumer in person or by telephone for the purpose of financing the contemporaneous purchase of goods or services, any risk-based pricing notice required to be provided pursuant to this subpart (or the disclosures permitted under § 222.74(e) or (f)) may be provided at the earlier of:
(i)
The time of the first mailing by the person to the consumer after the decision is made to approve the grant, extension, or other provision of open-end credit, such as in a mailing containing the account agreement or a credit card; or
(ii)
Within 30 days after the decision to approve the grant, extension, or other provision of credit.