Credit glossary
Compliance condition code
A Metro 2 field that furnishers use to flag legally required conditions on an account, most visibly that you dispute it.
The Consumer Data Industry Association describes this field as the way to report "a condition required for legal compliance," such as an account disputed under the FCRA's direct dispute rules, the Fair Credit Billing Act or the FDCPA, or one closed at the consumer's request. The FCRA backs it up: once you dispute with a furnisher, it can't keep reporting the information without noting the dispute (15 U.S.C. 1681s-2(a)(3)).
This is where the "consumer disputes this account" remark comes from, and mortgage underwriting reacts to it. A Bryan Cave analysis says the active-dispute code can cause scoring models to disregard the entry. Fannie Mae's Desktop Underwriter, when a loan doesn't approve with disputed tradelines included, reruns it without them and makes the lender investigate. Clear resolved dispute remarks months before you apply.
See every compliance condition codes in plain English, with what each one means and what to check on your report.
Guides that go deeper
- What not to dispute on your credit report before a mortgageDisputing accurate items rarely helps, and open disputes can stall a mortgage. How Fannie Mae and FHA treat disputed accounts, and what to do instead.
- Metro 2 explained: the data format behind your credit reportLenders don't mail the bureaus your history. They send Metro 2 files. What the format holds, how e-OSCAR and ACDVs move disputes, and why it matters.
Sources
- Metro 2 Advanced Webinar: Compliance Condition Codes, Consumer Data Industry Association
- 15 U.S.C. 1681s-2: Responsibilities of furnishers of information to consumer reporting agencies, Legal Information Institute, Cornell Law School
- Use of Compliance Condition Codes, Bryan Cave LLP
- B3-5.3-09, DU Credit Report Analysis, Fannie Mae Selling Guide
This is education, not legal or financial advice. Spot an error? Tell us and we'll fix it.