An MLO denies a mortgage application based partially on a credit report showing a bankruptcy from 8 years ago. The bankruptcy was actually discharged 11 years ago, but the credit report shows an incorrect date. For adverse action notice purposes, this error:
Correct Answer
C) Does not affect the adverse action notice requirements since the bankruptcy still influenced the decision
Under FCRA Section 615, adverse action notices must be sent when credit report information influences a denial, regardless of whether that information later proves to be inaccurate. The lender's obligation is to provide notice based on the information they relied upon at the time of the decision.
Why This Is the Correct Answer
Under FCRA Section 615, adverse action notices must be sent when credit report information influences a denial, regardless of whether that information later proves to be inaccurate. The lender's obligation is to provide notice based on the information they relied upon at the time of the decision.
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