What is the Equal Credit Opportunity Act?

The Equal Credit Opportunity Act (ECOA) is a federal law that was passed in 1974 to protect consumers from discrimination when applying for credit. This law applies to all businesses that extend credit, including banks, finance companies, credit unions, and retailers. The ECOA protects people from discrimination in all aspects of credit, including the application process and the terms and conditions of the loan. It prohibits lending institutions from discriminating against any applicant on the basis of race, color, religion, national origin, sex, marital status, age, or because the applicant receives income from a public assistance program. The ECOA also requires that when an applicant is denied a loan, the lender must provide the applicant with written notification that states the specific reasons for the denial. This helps applicants understand what may have gone wrong and take corrective action. In addition, the ECOA also requires lenders to provide applicants with accurate information regarding the cost and terms of a loan. This helps applicants make informed decisions about the loan they are applying for. In the state of Georgia, the ECOA is enforced by the Federal Trade Commission. The Commission has the authority to investigate alleged violations and can bring civil or criminal actions against lenders who violate the law.

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What is the Equal Credit Opportunity Act?

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