ECOA

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The Consumer Financial Protection Bureau (CFPB) and the Department of Justice (DOJ) have filed a Statement of Interest regarding the application of the Fair Housing Act (FHA) and the Equal Credit Opportunity Act (ECOA) to a lender that allegedly denied a loan to the plaintiffs based on a home appraisal alleged to be discriminatory.… Continue Reading

The FHFA announced that Fannie Mae and Freddie Mac will require mortgage servicers to maintain certain fair lending data elements, including the borrower’s age, race, ethnicity, gender, and preferred language. The fair lending data must be stored in a searchable format, and must transfer with servicing throughout the loan term.

On the topic, Freddie Mac issued Bulletin 2022-17, and Fannie Mae issued Servicing Guide Announcement SVC-2022-06.… Continue Reading

The CFPB has issued a new advisory opinion “to affirm that the Equal Credit Opportunity Act (ECOA) and Regulation B protect those actively seeking credit and those who sought and received credit.”

The ECOA defines an “applicant” to mean “any person who applies to a creditor directly for an extension, renewal, or continuation of credit, or applies to a creditor indirectly by use of an existing credit plan for an amount exceeding a previously established credit limit.”… Continue Reading

On February 4, 2022, the FTC sent its annual letter to the CFPB reporting on the FTC’s activities related to the Equal Credit Opportunity Act (ECOA) and Regulation B.  The Bureau includes the FTC’s annual letter in its own annual report to Congress on the ECOA.

The FTC has authority to enforce the ECOA and Regulation B with respect to nonbank financial service providers within its jurisdiction. … Continue Reading

The CFPB, FTC, DOJ, and Federal Reserve Board have filed a joint amicus brief in the U.S. Court of Appeals for the Seventh Circuit urging the court to reverse a district court ruling that an individual who had already received credit from the defendant and who was not currently applying to the defendant for credit was not an “applicant” for purposes of the ECOA’s adverse action notice requirement.… Continue Reading

The CFPB has filed a lawsuit against Oakland, CA-based online lender LendUpLoans alleging that LendUp is in violation of a 2016 Consent Order that required the lender to pay over $3.5 million in consumer redress as well as civil penalties and to cease  misleading consumers with alleged false claims about the cost of loans and the benefits of repeat borrowing.… Continue Reading

On August 23, 2021, the CFPB filed its sixth status report in the lawsuit alleging wrongful delay by the CFPB in adopting regulations to implement Section 1071 of the Dodd-Frank Act.

Section 1071 of the Dodd-Frank Act amended the Equal Credit Opportunity Act to require financial institutions to collect and report certain data in connection with credit applications made by women- or minority-owned businesses and small businesses.… Continue Reading

During May 2021, the federal Government Accountability Office (“GAO”) issued a report (GAO-21-393) containing findings from its review of issues related to the CFPB’s oversight and enforcement of the Equal Credit Opportunity Act (“ECOA”) and the Home Mortgage Disclosure Act (“HMDA”).  Specifically, the report examines how the CFPB has (i) managed the reorganization of its Office of Fair Lending and Equal Opportunity and related risks during 2018, (ii) monitored and reported on its fair lending performance, and (iii) used new HMDA data fields to analyze and support its fair lending activities. … Continue Reading

Two leaders of the CFPB’s Fair Lending Office – Patrice Ficklin, Fair Lending Director, and Charles Nier, Senior Fair Lending Counsel – recently published an article advocating for broader use of special purpose credit programs (“SPCPs”) by creditors.  The article, entitled “The Use of Special Purpose Credit Programs to Promote Racial and Economic Equity” and framed as an essay, can be found in the Poverty & Race Research Action Council’s (“PRRAC”) May 2021 edition of its series on new directions in racial justice in housing finance and is available here. … Continue Reading