Match each Fair Credit Reporting Act (FCRA) term or requirement with its correct description.
- Consumer ReportA standard background check containing credit history and public financial records.
- Investigative Consumer ReportAn in-depth background check that gathers information through personal interviews with friends, neighbors, or associates.
- 3-Day Disclosure RuleThe timeline within which an applicant must be notified in writing that an interview-based background check was requested.
- Adverse Action NoticeA required communication that must be issued to an applicant if an insurer rejects their application based on a credit check.
Answer
Consumer Report matches with standard credit history; Investigative Consumer Report matches with personal interviews; 3-Day Disclosure Rule matches with the notification timeline for interview-based checks; Adverse Action Notice matches with the required communication after an application rejection based on credit.
The FCRA distinguishes between standard consumer reports (credit and financial history) and investigative consumer reports (personal character interviews). Furthermore, it requires insurers to notify applicants within 3 days if an investigative report is ordered, and to provide an adverse action notice if an application is declined or rated up based on any credit information.
Step-by-Step Solution
Key Concept
Fair Credit Reporting Act (FCRA) Core Definitions and Notifications
Estimated Time:1m 0s