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Negative Information Disclosures w/ Adverse Action

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Question: 
The new bank I am with gives Negative Information Disclosures with Adverse Action Notices. I don't see how this is correct since we have not issued credit to them therefore we have no negative credit to report personally. Am I correct? I've looked at FACTA and TIL and found nothing I can show the lenders.
Answer: 

From the preamble to the release of the model Negative Information Disclosures:

Section 217 of the FACT Act requires that if any financial institution (1) extends credit and regularly and in the ordinary course of business furnishes information to a nationwide consumer reporting agency, and (2) furnishes negative information to such an agency regarding credit extended to a customer, the institution must provide a clear and conspicuous notice about furnishing negative information, in writing, to the customer.

Ask the lenders how in the world will they ever be reporting negative information to a credit bureau if they are not making the consumer a loan?

First published on BankersOnline.com 10/29/12

First published on 10/29/2012

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