If a lender uses a credit report to take adverse action, what must be provided to the consumer?

• A. The consumer must file a lawsuit to obtain remedies.
• B. The consumer is entitled to an adverse action notice and a free copy of the report on request.
• C. The lender must provide only a copy of the credit report.
• D. The consumer is entitled to a free credit report with no action required.

Answer: (B)

When a lender uses information in a consumer report to take adverse action, the responsible party must inform the consumer and offer access to the data used. Under the Fair Credit Reporting Act, the lender must provide an adverse action notice that explains the action taken and identifies the consumer reporting agency, along with a statement that the agency did not make the decision and cannot provide the reasons for it. In addition, the consumer must be told about the right to obtain a free copy of the report and to dispute its accuracy, and the free copy can be obtained from the reporting agency upon request (typically within 60 days).

So the best answer is: an adverse action notice and a free copy of the report on request. This ensures the consumer understands what information affected the decision and has the opportunity to review and challenge it.