NAA/NHMC Guidance on “Credit Score” Disclosure Effective July 21

This important information is in the latest issue of NAA’s AIMS Update (you can now find AIMS Updates in the “News” section of PTAA’s website):

NAA/NMHC have issued a new members-only guidance document to help member firms understand new “credit score” disclosures that go into effect on July 21.  As a result of a provision in last year’s Dodd-Frank Wall Street Reform law (P.L. 111-203), a firm using a “credit score” in the rental screening process that takes an adverse action against a rental applicant may have a new disclosure obligation.

If you or your resident screening service provider use a credit score and take an adverse action, you must comply with this new notice requirement.  Importantly, if you or your resident screening company do not use a credit score as defined, but use a scoring model specific to the rental decision (i.e., one not used in the loan process), then it is likely that you will have no additional notice obligations.

NAA/NMHC’s guidance highlights the key elements of the new credit score disclosure obligations.  NAA/NMHC encourage you to discuss this new rule with your provider and counsel to determine applicability to your specific rental screening process.