Fair Housing & Lending

Credit Discrimination

The Equal Credit Opportunity Act makes it illegal for a creditor to discriminate in any aspect of credit transaction based on certain characteristics. In addition, the Fair Housing Act makes many discrimination practices in home financing illegal.

It is illegal to:
- Refuse you credit if you qualify for it
- Discourage you from applying for credit
- Offer you credit on terms that are less favorable
- Close your account

On the basis of:
- Race or color
- Religion
- National origin
- Sex or Marital status
- Age (18 and older)
- Receipt of income from any public assistance program
- Exercising in good faith your rights under the Consumer Credit Protection Act.
*Additional state and local protections may exist

Responsible borrowers use credit to go to college, open businesses, and buy homes. American consumers should have the opportunity to use credit to build a better future for themselves and their loved ones. Credit discrimination prevents people from having access to these opportunities, and can make credit more expensive.

Warning Signs

Credit discrimination is often hidden or even unintentional, which makes it hard to spot. Look for red flags, such as:

- You are treated differently in person than on the phone.

- You are discouraged from applying for credit.

- You hear the lender make negative comments about race, national origin, sex, or other protected groups.

- You are refused credit even though you qualify for it.

- You are offered credit with a higher rate than the one you applied for, even though you qualify for the lower rate.

- You are denied credit, but not given a reason why or told how to find out why.

- Your deal sounds too good to be true.

- You feel pushed or pressured to sign.

If you believe a lender has discriminated against you for any reason, you can file a complaint with the Consumer Finance Protection Bureau. They will provide you a way to monitor the status and progress of your complaint.

Protect Yourself

Do your research. Compare products from several lenders. Learn about the various features and downsides of the credit product you want. Research current interest rates. Talk to your friends and family members about their credit products.

Know your credit history. Creditors will make decisions based on your credit history. Be sure there are no mistakes or missing items in your credit reports. Get a free copy of your credit report from each of the three consumer reporting agencies every 12 months through AnnualCreditReport.com.

Ask questions. Don’t focus only on your monthly payment. Understand the rates and fees you will pay over the long run. Ask whether the rates and fees quoted to you by your lender are set, or if there are any circumstances in which the quoted rates and fees could change. Keep asking questions until you are fully satisfied. If a creditor does not want to answer your questions, this could be a bad sign.

Stay in control. Your lender shouldn’t make you feel rushed, or unnecessarily delay action on your application. Walking away and continuing the discussion later, if you so choose, is a good way to control communications with the lender.

Don’t sign until you’re satisfied that the credit product works for you. Remember, what works for you today may not work for you down the road. Make sure you’ve considered both before you sign.

Additional Resources

Federal Trade Commission Mortgage Discrimination Consumer Information: www.consumer.ftc.gov

Wisconsin Fair Housing Counsel: www.fairhousingwisconsin.com

Fit Oshkosh: Race Literacy training and guidance - www.fit-oshkosh.org

*Information on this Fair Lending page is available through the Consumer Finance Protection Bureau. Laws and guidance are subject to change. The information contained on this page is intended to provide you with a starting point for understanding your rights and available actions of recourse. Prior to taking any action, you are strongly recommended to consult with a fair housing / fair lending specialist with the Wisconsin Fair Housing Counsel. In addition, you should consult your legal representative for any legal matters.