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GMAC survey finds consumers want more home financing education

National Mortgage Professional
May 24, 2005

Feds propose marketing limitationsMortgagePress.comFACTA,FDIC,FCRA The Federal Deposit Insurance Corporation, Board of Governors of the Federal Reserve System, Office of the Comptroller of the Currency, Office of Thrift Supervision and the National Credit Union Administration have sought comment on the proposed rules that implement Section 214 of the Fair and Accurate Credit Transactions Act of 2003 (FACT Act). Comments were due on Aug. 16. The FACT Act was signed into law on Dec. 4, 2003. In general, the FACT Act amends the Fair Credit Reporting Act (FCRA) to enhance the ability of consumers to combat identity theft, increase the accuracy of consumer reports and allow consumers to exercise greater control regarding the type and number of marketing solicitations they receive. To promote increasingly efficient national credit markets, the FACT Act establishes uniform national standards in key areas of regulation regarding consumer report information. The FACT Act authorizes a number of regulations on a variety of measures covered in the act. The following notice of proposed rulemaking (NPR) is authorized by Section 214 of the act. The NPR contains the statutory requirement for financial institutions to provide an opportunity for consumers to opt out of marketing solicitations that are based on certain information received from an affiliate. The proposal assigns responsibility for providing this opt-out to the financial institution that communicates the information about the consumer to its affiliates. An opt-out is not required when an affiliated entity that will market to the consumer: †Has a pre-existing business relationship with the consumer; †Already provides benefits to the consumer under an employee benefit plan; †Responds to a communication initiated by the consumer; or †Responds to an affirmative authorization or request by the consumer. The proposed rules contain examples of these exceptions. The statute requires that a consumer's election to opt out be applicable for five years. Some financial institutions may wish to simply make the consumer's opt-out election effective indefinitely. The NPR allows institutions to choose the method that is most efficient and least burdensome to their operations. The NPR contains the technical requirements for the content of opt-out notices, as well as model forms for institutions. For more information, visit www.fdic.gov.
Published
May 24, 2005
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