What Is a Pre-Adverse Action Notice or an Adverse Action Notice?
These are required notices that often come up when an employer, landlord, or gig platform is using a background check or credit-style report to make a negative decision about you. The key difference is timing: pre-adverse action happens before the decision becomes final, while adverse action is the final decision notice.
What is a Pre-Adverse Action notice?
A pre-adverse action notice is a warning that the company is considering taking negative action based on the report. It’s meant to give you a chance to:
Review the report,
Spot errors (wrong person, wrong status, sealed/expunged info, etc.), and
Dispute mistakes before you lose the opportunity.
It typically includes a copy of the report (or instructions to access it) and a document called “A Summary of Your Rights” under the FCRA. It helps you review your background report and dispute errors on the background check before the final decision is made.
What is an Adverse Action notice?
An adverse action notice is the message you get after the company makes the final decision, like denying the job, rescinding the offer, denying housing, requiring a co-signer, or deactivating your account.
This notice usually must include:
The name/contact info of the reporting company,
A statement that the reporting company didn’t make the decision,
Your right to get a free copy of the report, and
Your right to dispute inaccuracies.
The practical difference (why it matters)
Pre-adverse action = “We might deny you, check your report now.”
Adverse action = “We denied you, here’s the report we used and your rights.”
If you never received pre-adverse action and were denied immediately, that can be a red flag, especially if the decision was based on a consumer report and the process should have included notice and time to respond.