Discretionary lender allowances for use of credit scores as proxies for consumer risk

Rescind Regulations Allowing Socioeconomic Discrimination Based on Credit Ratings

AKA “Restore Fair Use Standards for Consumer Credit Data”


Which agency/agencies promulgated the regulation? *
Consumer Financial Protection Bureau (CFPB) / Federal Housing Finance Agency (FHFA) / Federal Reserve Board
Which title, parts, and/or sections of the Code of Federal Regulations (C.F.R.) should be rescinded? *
Rescind agency interpretive rules, guidance documents, and exemptions that permit the use of credit scores as primary or sole risk proxies under: 12 CFR Part 1002 (CFPB Reg B) 12 CFR Part 202 (Fed Reg B legacy enforcement) FHFA underwriting criteria for federally backed mortgages (e.g., GSE Loan Selling Guides, Desktop Underwriter risk models) Rescind approval of credit scoring systems that have not been empirically evaluated for disparate impact across race, income, and geography.
What is your name?
—OPTIONAL--
Is your proposed rescission a notice of proposed rulemaking, final rule, direct final rule, interim final rule, or interpretive rule? *
Interpretive Rule
What is the name of the regulation being rescinded, if applicable? *
Discretionary lender allowances for use of credit scores as proxies for consumer risk
Please provide a short summary of the justifications for the rescission. *
Restore the original intent of fair lending laws by prohibiting the use of credit scores as proxies for socioeconomic status, educational background, or income zip code clustering in loan and housing determinations.
Please insert the address of the agency. [NPRM, DFR, and IFR only]
Consumer Financial Protection Bureau 1700 G Street, NW Washington, D.C. 20552
Please insert the contact information for the agency. *
202-435-7700
What is the background for the regulation being rescinded? *
Credit scores were originally created as objective indicators of repayment history. Over time, they’ve been repurposed to systematically penalize individuals based on income volatility, neighborhood, student loan debt, and lack of access to financial products—creating a feedback loop of structural disadvantage. Current regulations allow lenders to use these scores and scoring models without adequate scrutiny of bias or disparate impact, even in federally backed programs.
Explain the reasons for the rescission. *
Permitting credit scores to serve as gatekeeping criteria for mortgages, rentals, employment, and insurance entrenches systemic inequality. These scores disproportionately penalize borrowers of color, young adults, immigrants, and anyone who avoids debt. A return to individual underwriting or alternative data models (with oversight) would better align with fair lending and civil rights laws. Ending the regulatory blessing of these flawed scoring practices is a necessary step toward financial equity.
Describe the text of the relevant C.F.R. provisions as it will exist after the rescission. *
All regulations permitting or interpreting credit score-based discrimination as "neutral" shall be rescinded. New rules must prohibit the use of credit scores as the sole or primary criteria in credit decisions, housing, or employment screening, especially where such use creates disparate impact. Agencies shall issue updated interpretive guidance requiring active testing and mitigation of bias in any algorithmic or model-based credit decision tool.
Please insert the name of the current agency head. *
Scott Bessent
Please insert the title of the agency head. *
Acting Director of the CFPB