Equal Credit Opportunity Act
The Federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on a basis of:
- Natural origin;
- Marital status;
- Age (provided that the applicant has the capacity to enter into a binding contract);
- All or part of the applicant's income derives from any public assistance program;
- The applicant has in good faith exercised any right under the Consumer Protection Act.
The Housing Financial Discrimination Act of 1977 requires that all lenders provide a "Fair Lending Notice" with the following information:
It is illegal to discriminate in the provision of or in the availability of financial assistance because of the consideration of:
Trends, characteristics or conditions in the neighborhood or geographic area surrounding a housing accommodation, unless the financial institution can demonstrate in the particular case that such consideration is required to avoid an unsafe and unsound business practice.
Race, color, religion, sex, marital status, national origin, or ancestry. It is illegal to consider the racial, ethnic, religious or national origin composition of a neighborhood or geographic area surrounding a housing accommodation or whether or not such composition is undergoing change, or is expected to undergo change, in appraising a housing accommodation or in determining whether or not, or under what terms and conditions, to provide financial assistance.
These provisions govern financial assistance for the purpose of the purchase, construction, rehabilitation or refinancing of one to four unit family residences occupied by the owner and for the purpose of the home improvement of any one to four unit family residence. As part of processing a real estate loan application, lenders may request a credit report about your creditworthiness, credit standing and credit capacity.
For additional reference: Fair Credit Reporting Act