The KC Regional FDIC office shared that during exams, if they see a credit report in a loan file, and do not see evidence to support that a Risk Based Pricing notice was provided, they will look at the loan trial balance and if they see a variety of different rates, there may be a problem.  At this point, the FDIC shared they will ask to the Bank to share the reasons for the rate deviation, essentially putting you in the position to provide that the basis for the variations in rates on the trial is completely independent from information reported in the borrower’s credit report.  What are you going to do when the notes in the file say, “discounted rate provided, long terms customer, good credit history?” If you are not providing any sort of notice, you need to be asking yourself, do you really want to position yourself to have to attempt to prove your pricing had nothing to do with information in the credit report?  The FDIC in the Kansas City Region has been advising Bank's in this situation to provide the notice to all customers when the loan is originated, not when it is applied for however, this advice is contrary to the commentary to the regualtions as it indicates that "The Agencies would expect that creditors would provide risk-based pricing notices to some, but fewer than all, of the consumers to whom they extend credit."

So what can you do to comply?  If you are not receiving the credit scores on your bureaus and your trial balance shows a variety of rates, you may have some difficult discussions regarding whether or not the credit bureau was used in setting the pricing on originated loans, and potential risk that you would not be able to successfully prove your case to your regulator, you could provide the model notice H-1 to all consumer loan customers who receive a rate higher than the most favorable rate available when a credit bureau was used in making the credit decision.  The notice should not be provided to loan applicants, as the staff anaylysis indicates that "commentors suggested that the Agencies allow the original creditor to provide a risk-based pricing notice to all consumers who apply for credit, including those who did not receive materially less favorable terms. However, the statute’s general rule does not suggest that a notice should be provided to every consumer who applies for credit. Moreover, the risk- based pricing notice requirement was designed to be a substitute for adverse action notices when a consumer received less favorable credit terms based on his or her consumer report, rather than being denied credit.  The Agencies believe that providing a notice to all consumers who apply for credit would diminish the impact of notifying a subset of consumers that they received credit on less than the best terms based on information in a consumer report. Providing a notice to all consumers who apply for credit would also have the effect of allowing consumers to receive a free consumer report whenever they applied for credit. For the foregoing reasons, the Agencies conclude that a person that uses a consumer report to grant, extend, or otherwise provide credit on material terms that are materially less favorable than the most favorable terms available to a substantial proportion of consumers is required to provide a risk-based pricing notice only to those consumers who receive materially less favorable terms. "   

 Your forms builders will require you to input how you used the credit report, and we recommend you input that you used it to determine the terms, rate and/or down payment requirements you gave the customers, as if you did a full file review; you most likely will find files which had rate exceptions which could be tied back to  information contained in the credit report.  The notice should be provided to all loan customers who received greater than the most favorable rate which appears for that loan type on your trial at closing and evidence it was provided should exist.  Evidence could be a standard procedures, or a copy of it could be maintained in the loan file.  The benefit to loan customers is it gives them the right to receive a free copy of their credit report within 60 days of receipt of the notice.  As you know, you already provide this right to denied consumers through the FCRA disclosures on your adverse action notices when you check that the credit bureau was used in making the decision.