Regulation B, issued by the CFPB to implement ECOA, applies to all persons who are creditors, meaning persons who, in the ordinary course of business, regularly participate in credit decisions, set the terms of credit, or refer applicants to creditors.
The Federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status, age (provided the applicant has the capacity to enter into a binding contract); because all or part of the applicant's income derives ...
ECOA prohibits discrimination in all aspects of a credit transaction and applies to any organization that extends credit—including banks, small loan and finance companies, retail stores, credit card companies, and credit unions. It also applies to anyone involved in the decision to grant credit or set credit terms.
Equal Credit Opportunity Act (ECOA) promotes the availability of credit to all creditworthy applicants without regard to race, color, religion, national origin, sex, marital status, or age (provided the applicant has the capacity to contract); to the fact that all or part of the applicant's income derives from a public ...
This Act (Title VII of the Consumer Credit Protection Act) prohibits discrimination on the basis of race, color, religion, national origin, sex, marital status, age, receipt of public assistance, or good faith exercise of any rights under the Consumer Credit Protection Act.
What types of classifications are “suspect”? In light of the history of the Equal Protection Clause, it is no surprise that race and national origin are suspect classifications. But the Court has also held that gender, immigration status, and wedlock status at birth qualify as suspect classifications.
ECOA applies to various types of loans including car loans, credit cards, home loans, student loans, and small business loans.
Imposing unfair terms or conditions on a loan (such as lower loan amount or higher interest rates) based on personal characteristics protected under the ECOA. Asking detailed personal information regarding marital status, such as whether you are widowed or divorced.
It is illegal to:
Refuse you credit if you qualify for it. Discourage you from applying for credit. Offer you credit on terms that are less favorable, like a higher interest rate, than terms offered to someone with similar qualifications.
If you've been denied credit, the creditor must give you the name and address of the agency to contact. Different federal agencies, including the FTC, share enforcement responsibility for the ECOA. Report your concerns to the creditor. Sometimes you can persuade the creditor to reconsider your application.
The law applies to any person who, in the ordinary course of business, regularly participates in a credit decision, including banks, retailers, bankcard companies, finance companies, and credit unions.
A creditor must notify an applicant of action taken on the applicant's request for credit, whether favorable or adverse, within 30 days after receiving a completed application.
Types of Lending Discrimination
Overt evidence of disparate treatment; • Comparative evidence of disparate treatment; and • Evidence of disparate impact.
The Department of Justice may file a lawsuit under ECOA where there is a pattern or practice of discrimination. In cases involving discrimination in home mortgage loans or home improvement loans, the Department may file suit under both the Fair Housing Act and ECOA.
Homeowners May Sue Banks for Denial of Loan Modification. The 8th Circuit Court of Appeals has ruled that a homeowner has a private right of action to sue their mortgage lender when the bank fails to properly process the application.
Your marital status cannot be used against you when evaluating your credit application. Any questions about your race, ethnicity and gender cannot be used as a reason to approve or deny your credit application. Creditors have to provide equal information to all borrowers throughout the entire transaction.
In addition to actual damages, Regulation B provides for punitive damages of up to $10,000 in individual lawsuits and up to the lesser of $500,000 or 1 percent of the bank's net worth in class action suits. Successful complainants are also entitled to an award of court costs and attorney's fees.
The purpose of ECOA is to promote the availability of credit to all creditworthy applicants without regard to race, color, religion, national origin, sex, marital status, or age (provided the applicant has the capacity to contract); because all or part of the applicant's income derives from any public assistance ...
A creditor must evaluate income derived from part-time employment, alimony, child support, separate maintenance payments, retirement benefits, or public assistance on an individual basis, not on the basis of aggregate statistics; and must assess its reliability or unreliability by analyzing the applicant's actual ...
The Equal Credit Opportunity Act (ECOA), otherwise known as "Regulation B," was enacted in 1974 and falls under the larger Consumer Credit Protection Act. It exists to help individuals from being denied from accessing credit based on discriminatory factors.
Fourteenth Amendment, Section 1: All persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside.
Strict scrutiny is the highest standard of review that a court will use to evaluate the constitutionality of government action, the other two standards being intermediate scrutiny and the rational basis test .