Understanding the Equal Credit Opportunity Act

The Equal Credit Opportunity Act (“ECOA”) 15 U.S.C. § 1691 et
seq. Past _due _imgis a United States law enacted in 1974, that
makes it illegal for a creditor to discriminate against a credit
applicant on the basis of race, color, religion, national origin,
sex, marital status, age or because you receive public
assistance.  The ECOA applies to any person who, in the
ordinary course of business, regularly participates in a credit
decision, including banks, retailers, credit card companies,
finance companies and credit unions.  Failure to comply with
the rules and regulations of the ECOA may subject a creditor to
actual and punitive damages as high as $10,000 in an individual
suit and up to $500,000 in a class action. 

When applying for credit it is important to understand your
rights and what a creditor may and/or may not ask of you during the
application process.  First, a creditor may likely ask you for
personal information such as race, religion, sex, martial status,
etc. but may not use this information in basing its decision on
whether or not to extend you credit.  A creditor may not
impose alternate terms or conditions on your loan if approved
simply because of this information, such as a higher interest rate
or fees.  Factors such as income, expenses, debt and credit
history however may legally be evaluated in determining whether to
extend you credit.

Furthermore, a creditor may not ask if you are widowed or
divorced, but may inquire about your marital status if you are
applying for a joint account.  Similarly, a creditor may not
ask for information about your spouse unless you are applying for a
joint account or plan to make your spouse an authorized user on the
account.  However, if you reside in a community property
state, the creditor grantor may inquire about your spouse without
violating the spirit of the ECOA.   Lastly, a creditor
may not ask about your plans to have or to raise children but may
ask about living children and whether or not you are financially
responsible for their care as this may impact your ability to make
payment on a debt.

If a creditor has discriminated against you, you are entitled to
sue the creditor in federal court under the ECOA.  If
successful, you are entitled to recovery as described above
including your attorneys’ fees and court costs.  If you feel
your rights have been violated under the ECOA, contactSmithMarco
for a free case