I am an indirect lender — I do not open accounts directly with a consumer but purchase loans in the secondary market. Am I required to have a Program?
If the loans that you purchase would be considered “covered accounts,” you may be required to have a Program. As a secondary market purchaser of loans, however, you may not be considered to “regularly participate” in credit decisions and therefore may not be a “creditor” under the ECOA. In addition, the Rule requires you to address the risks of identity theft in connection with account opening and access. Because you do not originate or “open” accounts but rather purchase them on the secondary market, even if the loans you purchase are “covered” accounts, you should only be required to address the risk of identity theft in connection with account access.
Related Questions
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