Compliance – Soft Pull vs. Hard Pull: Recently, our originators are requesting the ability to pull a soft pull on a client vs. a hard pull, as other lenders in the area are doing it, and it could be a cost-saving measure. Is this a regulatory issue?
Answer: QM/ATR only requires that the lender determine how they are going to validate credit history vs. telling you what type of report that you need. However, it will likely cause you regulatory issues under ECOA. When you issue adverse actions based solely on a soft pull, you do not have the entire picture of […]