The Consumer Financial Protection Bureau (CFPB) has proposed an amendment to the Equal Credit Opportunity Act (ECOA) that extends more flexibility to mortgage lenders when collecting ethnicity and race information, offering clarity to alleviate compliance concerns. The ECOA restricts lenders from asking applicants about their color, national origin, race, religion or sex under Regulation B, with some exceptions. The proposal would allow more lenders in permissible cases to use applications, including the revised Uniform Residential Loan Application, with questions about ethnicity and race, eliminating the requirement for separate information-gathering procedures based on factors such as loan volume.
“This law is a key part of the government’s commitment to root out discrimination,” says Richard Cordray, director of the CFPB. “This proposal will help industry comply with the law and help protect consumers against illegal discrimination.”
Members of the industry and the public are encouraged to submit feedback on the proposed amendment to the CFPB. The proposal can be viewed here.
Source: Consumer Financial Protection Bureau (CFPB)
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