Equal Credit Opportunity Act of 1974 (ECOA)

Who signed it and when was it signed?

• President Ford
• Signed on October 28, 1974

What is it?

• It made it unlawful for any creditor to discriminate against any applicant on the basis of race, color, religion, national origin, sex, marital status, or age

Who does it apply to?

• 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.

Requirements

• Creditors must inform the candidate if they have been denied or granted credit within 30 days of receiving their completed application
• Give a specific reason why one is denied credit or granted less credit than originally applied for.

Prohibitions

• Discriminate based on race, sex, age, national origin, or marital status, or because one receives public assistance
• Ask about marital status
• Ask if planning on having children
• Disallow regular sources of income

Equal Credit Opportunity Act of 1974 (ECOA)

• Failure to comply can subject a financial constitution to civil liability for actual and punitive damages in individual or class actions. Liability for punitive damages can be as much as $!0,000 in individual actions and the lesser of $500,000 or 1% of the creditor's net worth in class actions

Court cases

Untitled Slide

• United States v. Mortgage Guaranty Insurance Corp (July 5, 2011)
• United States v. Nixon State Bank (June 21, 2011)
• USSAA Federal Savings Bank v. Pennsylvania Human Rights Commission (April 28, 2011)