Published July 15, 2026. By Nam Nguyen, Namhaha Media. General information, not legal advice. Have counsel review your template for your jurisdiction.
Disclosure: this article contains affiliate links.
Section 615(a) of the Fair Credit Reporting Act requires a landlord to send an adverse action notice whenever a consumer report contributes in any way to a decision that disadvantages a rental applicant. That includes denial, a higher security deposit, a cosigner requirement, or less favorable lease terms. The Federal Trade Commission notes the notice is required even when the report played only a small part in the decision.
Key takeaways
- Adverse action is broader than denial. Higher deposits and cosigner requirements count.
- The notice must identify the consumer reporting agency and state that the agency did not make the decision.
- The applicant has the right to a free copy of the report within 60 days and the right to dispute inaccuracies.
- Notice may be given orally, in writing or electronically, but written notice is strongly recommended because it proves compliance.
- You do not have to explain your reasons. You do have to point the applicant to the report and their rights.
When do you owe an adverse action notice?
Any time a consumer report is part of a decision that treats the applicant less favorably than they asked to be treated. Common triggers:
- Denying the application.
- Approving with a higher security deposit than advertised.
- Requiring a cosigner or guarantor.
- Requiring the first and last month’s rent when your listing said first month only.
- Reducing the lease term offered.
- Charging a higher rent than advertised.
The threshold is low by design. If the report was in the room when you decided, send the notice.
The mistake landlords make is thinking approval means no notice is needed. If you approved someone but changed the terms because the report showed something, you took adverse action and you owe the notice.
Screening reports come with obligations
Whichever service you use, the notice requirement is yours. SmartMove provides an adverse action template alongside its reports.
What the notice must contain
Under FCRA section 615(a), the notice must:
- State that adverse action was taken based in whole or in part on information in a consumer report.
- Identify the consumer reporting agency that furnished the report, including name, address and telephone number.
- State clearly that the agency did not make the decision and is unable to provide the specific reasons for it.
- Inform the applicant of their right to obtain a free copy of the report from the agency if they request it within 60 days.
- Inform the applicant of their right to dispute the accuracy or completeness of any information in the report directly with the agency.
Notice may be delivered orally, in writing or electronically. Written notice is the practical standard, because an oral notice you cannot evidence is functionally the same as no notice when someone complains.
Template
Adapt this and have counsel confirm it for your jurisdiction. Replace bracketed text.
Notice of Adverse Action
Date: [DATE]
To: [APPLICANT NAME]
Re: Application for [PROPERTY ADDRESS], [UNIT]
Thank you for your application to rent the above property.
We are writing to inform you that we have taken adverse action on your application. Specifically, we have [denied your application / approved your application with a security deposit of $X instead of the advertised $Y / required a cosigner]. This decision was based in whole or in part on information contained in a consumer report.
The consumer reporting agency that provided the report is:
[AGENCY NAME]
[AGENCY ADDRESS]
[AGENCY TELEPHONE NUMBER]
The consumer reporting agency named above did not make the decision regarding your application and is unable to provide you with the specific reasons for our decision.
You have the right to obtain a free copy of your consumer report from the agency named above if you request it within 60 days of receiving this notice. You also have the right to dispute directly with the consumer reporting agency the accuracy or completeness of any information contained in your report.
Sincerely,
[LANDLORD NAME]
[CONTACT INFORMATION]
Keep a copy with the application file. Send by email with a read receipt where possible, or by mail with proof of sending.
What you should not put in it
Do not list your reasons in detail. The law does not require you to explain the decision, and a detailed explanation invites argument about each item. State that adverse action was taken based in whole or in part on a consumer report, and point to the agency.
Do not reference protected characteristics, obviously, and do not reference anything that could be read as a proxy for one.
Do not editorialize. “We found your credit history concerning given your employment situation” is the sentence that appears in a complaint. Keep it procedural.
(Landlords resist this letter because it feels adversarial after a friendly process. In practice the opposite is true. The notice is the applicant’s route to discovering that the eviction record on their file belongs to a different person with the same name, which happens more often than the industry admits. Sending it well is a courtesy as much as a compliance step.)
What if the applicant disputes something?
Direct them to the consumer reporting agency. You are not the fact-finder for the underlying data and you should not try to be.
If the agency corrects the record and the applicant returns with an updated report while the unit is still available, treat them as a new applicant under your written criteria. If the unit is gone, say so plainly.
Timing and record keeping
Send the notice promptly after the decision. The FCRA does not set a specific deadline in this context, but a notice sent weeks later looks like an afterthought and gives the applicant less practical benefit from their 60-day window.
Keep, for a consistent retention period across all applicants: the application, the report, your written criteria, your one-sentence decision note, and a copy of the notice with proof of delivery.
Keep the whole file in one place
Order screening, read the reports and keep your documentation together for every applicant.
FAQ
Do I have to send an adverse action notice if I deny for income, not credit?
If the consumer report contributed in any way to the decision, yes. If your decision rested purely on information outside any consumer report, the FCRA notice requirement is not triggered, but documenting that distinction clearly is essential.
Can I give the notice verbally?
The FCRA permits oral, written or electronic notice. Written notice is strongly recommended because it evidences compliance.
What if I approved the applicant but raised the deposit?
That is adverse action and requires a notice.
Do I have to say why I denied them?
No. You must state that adverse action was taken based in whole or in part on a consumer report and identify the agency. You are not required to give your specific reasons.
Does this apply if I only ran a criminal check?
Yes. A criminal background report from a screening company is a consumer report under the FCRA.
Sources
- Fair Credit Reporting Act, section 615(a)
- Federal Trade Commission, “Using Consumer Reports: What Landlords Need to Know,” including guidance that notice is required even where the report was a small part of the decision
- TransUnion SmartMove property owner resources, which include an adverse action template
The bottom line
Write the template once, save it next to your rental application, and send it every time a report touches a negative decision. It takes two minutes, it costs nothing, and it removes the most common source of legal exposure in small-scale landlording.
