1785.3.

 The following terms as used in this title have the meaning expressed in this section:

(a) “Adverse action” means a denial or revocation of credit, a change in the terms of an existing credit arrangement which is adverse to the interests of the consumer, or a refusal to grant credit in substantially the amount or on substantially the terms requested. “Adverse action” includes all of the following:

(1) Any denial of, increase in any charge for, or reduction in the amount of, insurance for personal, family, or household purposes made in connection with the underwriting of insurance.

(2) Any denial of employment or any other decision made for employment purposes which adversely affects any current or prospective employee.

(3) Any action taken, or determination made, with respect to a consumer (A) for an application for an extension of credit, or an application for the hiring of a dwelling unit, and (B) that is adverse to the interests of the consumer.

“Adverse action” does not include (A) a refusal to extend additional credit to a consumer under an existing credit arrangement if (i) the applicant is delinquent or otherwise in default under that credit arrangement or (ii) the additional credit would exceed a credit limit previously established for the consumer or (B) a refusal or failure to authorize an account transaction at a point of sale.

(b) “Consumer” means a natural individual.

(c) “Consumer credit report” means any written, oral, or other communication of any information by a consumer credit reporting agency bearing on a consumer’s credit worthiness, credit standing, or credit capacity, which is used or is expected to be used, or collected in whole or in part, for the purpose of serving as a factor in establishing the consumer’s eligibility for: (1) credit to be used primarily for personal, family, or household purposes, or (2) employment purposes, or (3) hiring of a dwelling unit, as defined in subdivision (c) of Section 1940, or (4) other purposes authorized in Section 1785.11.

The term does not include (1) any report containing information solely as to transactions or experiences between the consumer and the person making the report, (2) any communication of that information or information from a credit application by a consumer that is internal within the organization that is the person making the report or that is made to an entity owned by, or affiliated by corporate control with, that person; provided that the consumer is informed by means of a clear and conspicuous written disclosure that information contained in the credit application may be provided to these persons; however, where a credit application is taken by telephone, disclosure shall initially be given orally at the time the application is taken, and a clear and conspicuous written disclosure shall be made to the consumer in the first written communication to that consumer after the application is taken, (3) any authorization or approval of a specific extension of credit directly or indirectly by the issuer of a credit card or similar device, (4) any report by a person conveying a decision whether to make a specific extension of credit directly or indirectly to a consumer in response to a request by a third party, if the third party advises the consumer of the name and address of the person to whom the request was made and the person makes the disclosures to the consumer required under Section 1785.20, (5) any report containing information solely on a consumer’s character, general reputation, personal characteristics, or mode of living which is obtained through personal interviews with neighbors, friends, or associates of the consumer reported on, or others with whom he is acquainted or who may have knowledge concerning those items of information, (6) any communication about a consumer in connection with a credit transaction which is not initiated by the consumer, between persons who are affiliated (as defined in Section 150 of the Corporations Code) by common ownership or common corporate control (as defined by Section 160 of the Corporations Code), if either of those persons has complied with paragraph (2) of subdivision (b) of Section 1785.20.1 with respect to a prequalifying report from which the information communicated is taken and provided the consumer has consented to the provision and use of the prequalifying report in writing, or (7) any consumer credit report furnished for use in connection with a transaction which consists of an extension of credit to be used solely for a commercial purpose.

(d) “Consumer credit reporting agency” means any person who, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the business of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer credit reports to third parties, but does not include any governmental agency whose records are maintained primarily for traffic safety, law enforcement, or licensing purposes.

(e) “Credit transaction that is not initiated by the consumer” does not include the use of a consumer credit report by an assignee for collection or by a person with which the consumer has an account for purposes of (1) reviewing the account or (2) collecting the account. For purposes of this subdivision, “reviewing the account” includes activities related to account maintenance and monitoring, credit line increases, and account upgrades and enhancements.

(f) “Employment purposes,” when used in connection with a consumer credit report, means a report used for the purpose of evaluating a consumer for employment, promotion, reassignment, or retention as an employee.

(g) “File,” when used in connection with information on any consumer, means all of the information on that consumer recorded and retained by a consumer credit reporting agency, regardless of how the information is stored.

(h) “Firm offer of credit” means any offer of credit to a consumer that will be honored if, based on information in a consumer credit report on the consumer and other information bearing on the creditworthiness of the consumer, the consumer is determined to meet the criteria used to select the consumer for the offer and the consumer is able to provide any real property collateral specified in the offer. For purposes of this subdivision, the phrase “other information bearing on the creditworthiness of the consumer” means information that the person making the offer is permitted to consider pursuant to any rule, regulation, or formal written policy statement relating to the federal Fair Credit Reporting Act, as amended (15 U.S.C. Sec. 1681 et seq.), promulgated by the Federal Trade Commission or any federal bank regulatory agency.

(j) “Item of information” means any of one or more informative entries in a credit report which causes a creditor to deny credit to an applicant or increase the cost of credit to an applicant or deny an applicant a checking account with a bank or other financial institution.

(k) “Person” means any individual, partnership, corporation, trust, estate, cooperative, association, government or governmental subdivision or agency, or other entity.

(l) “Prequalifying report” means a report containing the limited information permitted under paragraph (2) of subdivision (b) of Section 1785.11.

(m) “State or local child support enforcement agency” means the Department of Child Support Services or local child support agency acting pursuant to Division 17 (commencing with Section 17000) of the Family Code to establish, enforce or modify child support obligations, and any state or local agency or official that succeeds to these responsibilities under a successor statute.

1785.11.

 (a) A consumer credit reporting agency shall furnish a consumer credit report only under the following circumstances:

(1) In response to the order of a court having jurisdiction to issue an order.

(2) In accordance with the written instructions of the consumer to whom it relates.

(3) To a person whom it has reason to believe:

(A) Intends to use the information in connection with a credit transaction, or entering or enforcing an order of a court of competent jurisdiction for support, involving the consumer as to whom the information is to be furnished and involving the extension of credit to, or review or collection of an account of, the consumer; or

(B) Intends to use the information for employment purposes; or

(C) Intends to use the information in connection with the underwriting of insurance involving the consumer, or for insurance claims settlements; or

(D) Intends to use the information in connection with a determination of the consumer’s eligibility for a license or other benefit granted by a governmental instrumentality required by law to consider the applicant’s financial responsibility or status; or

(E) Intends to use use, pursuant to Section 1785.20.6, the information in connection with the hiring of a dwelling unit, as defined in subdivision (c) of Section 1940; or

(F) Otherwise has a legitimate business need for the information in connection with a business transaction involving the consumer.

(b) A consumer credit reporting agency may furnish information for purposes of a credit transaction specified in subparagraph (A) of paragraph (3) of subdivision (a), where if it is a credit transaction that is not initiated by the consumer, only under the circumstances specified in paragraph (1) or (2), as follows:

(1) The consumer authorizes the consumer credit reporting agency to furnish the consumer credit report to the person.

(2) The proposed transaction involves a firm offer of credit to the consumer, the consumer credit reporting agency has complied with subdivision (d), and the consumer has not elected pursuant to paragraph (1) of subdivision (d) to have the consumer’s name excluded from lists of names provided by the consumer credit reporting agency for purposes of reporting in connection with the potential issuance of firm offers of credit. A consumer credit reporting agency may provide only the following information pursuant to this paragraph:

(A) The name and address of the consumer.

(B) Information pertaining to a consumer that is not identified or identifiable with a particular consumer.

(c) Except as provided in paragraph (3) of subdivision (a) of Section 1785.15, a consumer credit reporting agency shall not furnish to any person a record of inquiries solely resulting from credit transactions that are not initiated by the consumer.

(d) (1) A consumer may elect to have his or her their name and address excluded from any list provided by a consumer credit reporting agency pursuant to paragraph (2) of subdivision (b) by notifying the consumer credit reporting agency, by telephone or in writing, through the notification system maintained by the consumer credit reporting agency pursuant to subdivision (e), that the consumer does not consent to any use of consumer credit reports relating to the consumer in connection with any transaction that is not initiated by the consumer.

(2) An election of a consumer under paragraph (1) shall be effective with respect to a consumer credit reporting agency, and any affiliate of the consumer credit reporting agency, on the date on which the consumer notifies the consumer credit reporting agency.

(3) An election of a consumer under paragraph (1) shall terminate and be of no force or effect following notice from the consumer to the consumer credit reporting agency, through the system established pursuant to subdivision (e), that the election is no longer effective.

(e) Each consumer credit reporting agency that furnishes a prequalifying report pursuant to subdivision (b) in connection with a credit transaction not initiated by the consumer shall establish and maintain a notification system, including a toll-free telephone number, that permits any consumer, with appropriate identification and for which the consumer credit reporting agency has a file, to notify the consumer credit reporting agency of the consumer’s election to have the consumer’s name removed from any list of names and addresses provided by the consumer credit reporting agency, and by any affiliated consumer credit reporting agency, pursuant to paragraph (2) of subdivision (b). Compliance with the requirements of this subdivision by a consumer credit reporting agency shall constitute compliance with those requirements by any affiliate of that consumer credit reporting agency.

(f) Each consumer credit reporting agency that compiles and maintains files on consumers on a nationwide basis shall establish and maintain a notification system under paragraph (1) of subdivision (e) jointly with its affiliated consumer credit reporting agencies.

1785.20.6.

 (a) For purposes of this section:

(1) “Applicant” means a natural person who applies to hire a dwelling unit.

(2) “Consumer credit report” means a written, oral, or other communication of any information by a consumer credit reporting agency bearing on a consumer’s credit worthiness, credit standing, or credit capacity.

(3) “Tenant” means a natural person who hires real property and is not any of the following:

(A) A commercial tenant, as defined in Section 1162 of the Code of Civil Procedure.

(B) A person described in subdivision (b) of Section 1940.

(4) “Use a consumer credit report” means to review, use, or consider information in a consumer credit report.

(b) Except as provided in subdivision (c), a person shall not do either of the following for a purpose related to the hiring of a dwelling unit:

(A) Use a consumer credit report.

(B) Require an applicant or tenant to answer a question about the contents of a consumer credit report or the information contained therein.

(c) (1) Subject to paragraph (2), a person may engage in the activities described in subdivision (b) only if required to do so under federal or state law or regulation.

(2) A person engaging in the activities described in subdivision (b) pursuant to this subdivision shall comply with all of the following:

(A) A person shall obtain the written consent of the tenant or applicant in a document that consists solely of that consent each time that the person seeks to use a consumer credit report of a tenant or applicant.

(B) A person shall disclose in writing the reason for accessing the consumer credit report to the tenant or applicant.

(C) (i) If a person intends to take an adverse action that is based, in whole or in part, on the consumer credit report, the person shall disclose, in writing at least 14 days before taking the action, the adverse action and the reason for the action, including the information in the consumer credit report that was the basis for the action.

(ii) The written disclosure required by this subparagraph shall include a copy of the consumer credit report and the notice of consumer reports required by Section 1681g(c)(1) of Title 15 of the United States Code.

(D) A person described in subparagraph (C) shall provide the tenant or applicant, in a private discussion, the opportunity to dispute the relevance of the information upon which the person intends to justify the adverse action, and the person shall consider the dispute before making a final decision.

(E) If, during the 14-day period before the person takes an adverse action disclosed pursuant to subparagraph (C), the tenant or applicant provides oral or written notice to the person that the tenant or applicant is disputing the accuracy of the consumer credit report with a consumer reporting agency, the person shall not take an adverse action until the dispute is resolved pursuant to Section 1785.16 or Section 1681i(a) of Title 15 of the United States Code, and the person shall consider the results of the resolution before taking the adverse action.

(d) A person shall not retaliate, discriminate, or take an adverse action against a tenant or applicant on the basis that the tenant or applicant has or intends to do any of the following:

(1) File a complaint.

(2) Allege that the person violated this section.

(3) Participate in an investigation, proceeding, or action concerning a violation of this section.

(4) Otherwise oppose a violation of this section.

(e) A waiver of the provisions of this title is contrary to public policy and is void and unenforceable.

(f) Failure to comply with this section shall be enforceable under Section 1785.31.

1950.6.

 (a) Notwithstanding Section 1950.5, when a landlord or his or her a landlord’s agent receives a request to rent a residential property from an applicant, the landlord or his or her the landlord’s agent may charge that applicant an application screening fee to cover the costs of obtaining information about the applicant. The Subject to Section 1785.20.6, the information requested and obtained by the landlord or his or her the landlord’s agent may include, but is not limited to, personal reference checks and consumer credit reports produced by consumer credit reporting agencies as defined in Section 1785.3. A landlord or his or her the landlord’s agent may, but is not required to, accept and rely upon a consumer credit report presented by an applicant.

(b) The amount of the application screening fee shall not be greater than the actual out-of-pocket costs of gathering information concerning the applicant, including, but not limited to, the cost of using a tenant screening service or a consumer credit reporting service, service and the reasonable value of time spent by the landlord or his or her a landlord’s agent in obtaining information on the applicant. In no case shall the The amount of the application screening fee charged by the landlord or his or her the landlord’s agent shall not be greater than thirty dollars ($30) per applicant. The thirty dollar ($30) application screening fee may be adjusted annually by the landlord or his or her the landlord’s agent commensurate with an increase in the Consumer Price Index, beginning on January 1, 1998.

(c) Unless the applicant agrees in writing, a landlord or his or her a landlord’s agent may not charge an applicant an application screening fee when he or she the landlord or the landlord’s agent knows or should have known that no rental unit is available at that time or will be available within a reasonable period of time.

(d) The landlord or his or her the landlord’s agent shall provide, personally, or by mail, the applicant with a receipt for the fee paid by the applicant, which receipt shall itemize the out-of-pocket expenses and time spent by the landlord or his or her the landlord’s agent to obtain and process the information about the applicant.

(e) If the landlord or his or her the landlord’s agent does not perform a personal reference check or does not obtain a consumer credit report, the landlord or his or her the landlord’s agent shall return any amount of the screening fee that is not used for the purposes authorized by this section to the applicant.

(f) If an application screening fee has been paid by the applicant and if requested by the applicant, the landlord or his or her the landlord’s agent shall provide a copy of the consumer credit report to the applicant who is the subject of that report.

(g) As used in this section, “landlord” means an owner of residential rental property.

(h) As used in this section, “application screening fee” means any nonrefundable payment of money charged by a landlord or his or her a landlord’s agent to an applicant, the purpose of which is to purchase a consumer credit report and to validate, review, or otherwise process an application for the rent or lease of residential rental property.

(i) As used in this section, “applicant” means any entity or individual who makes a request to a landlord or his or her a landlord’s agent to rent a residential housing unit, unit or an entity or individual who agrees to act as a guarantor or cosignor on a rental agreement.

(j) The application screening fee shall not be considered an “advance fee” as that term is used in Section 10026 of the Business and Professions Code, Code and shall not be considered “security” as that term is used in Section 1950.5.

(k) This section is not intended to preempt any provisions or regulations that govern the collection of deposits and fees under federal or state housing assistance programs.