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Credit Discrimination: 15(a)(2) Corrective action required.

1. To qualify for the privilege, appropriate corrective action is required when the results of a self-test show that it is more likely than not that there has been a violation of the ECOA or this part. A self-test is also privileged when it identifies no violations.

Credit Discrimination: 2(f) Dwelling.

1. General. The definition of a dwelling is not limited to the principal or other residence of the applicant or borrower, and thus includes vacation or second homes and investment properties.

Credit Discrimination: 2(g) Financial Institution.

1. Preceding calendar year and preceding December 31. The definition of financial institution refers both to the preceding calendar year and the preceding December 31. These terms refer to the calendar year and the December 31 preceding the current calendar year. For example, in 2021, the preceding calendar year is 2020, and the preceding December 31 is December 31, 2020.

Credit Discrimination: 2(i) Home Improvement Loan.

1. General. Section 1003.2(i) defines a home improvement loan as a closed-end mortgage loan or an open-end line of credit that is for the purpose, in whole or in part, of repairing, rehabilitating, remodeling, or improving a dwelling or the real property on which the dwelling is located. For example, a closed-end mortgage loan obtained to repair a dwelling by replacing a roof is a home improvement loan under § 1003.2(i).

Credit Discrimination: 2(j) Home Purchase Loan.

1. Multiple properties. A home purchase loan includes a closed-end mortgage loan or an open-end line of credit secured by one dwelling and used to purchase another dwelling. For example, if a person obtains a home-equity loan or a reverse mortgage secured by dwelling A to purchase dwelling B, the home-equity loan or the reverse mortgage is a home purchase loan under § 1003.2(j).

Credit Discrimination: 2(l) Manufactured Home.

1. Definition of a manufactured home. The definition in § 1003.2(l) refers to the Federal building code for manufactured housing established by the U.S. Department of Housing and Urban Development (HUD) (24 CFR part 3280.2). Modular or other factory-built homes that do not meet the HUD code standards are not manufactured homes for purposes of § 1003.2(l). Recreational vehicles are excluded from the HUD code standards pursuant to 24 CFR 3282.8(g) and are also excluded from the definition of dwelling for purposes of § 1003.2(f). See comment 2(f)–3.

Credit Discrimination: 2(n) Multifamily Dwelling.

1. Multifamily residential structures. The definition of dwelling in § 1003.2(f) includes multifamily residential structures and the corresponding commentary provides guidance on when such residential structures are included in that definition. See comments 2(f)–2 through -5.

Credit Discrimination: 2(o) Open-End Line of Credit.

1. General. Section 1003.2(o) defines an open-end line of credit as an extension of credit that is secured by a lien on a dwelling and that is an open-end credit plan as defined in Regulation Z, 12 CFR 1026.2(a)(20), but without regard to whether the credit is consumer credit, as defined in § 1026.2(a)(12), is extended by a creditor, as defined in § 1026.2(a)(17), or is extended to a consumer, as defined in § 1026.2(a)(11).

Credit Discrimination: 2(p) Refinancing.

1. General. Section 1003.2(p) defines a refinancing as a closed-end mortgage loan or an open-end line of credit in which a new, dwelling-secured debt obligation satisfies and replaces an existing, dwelling-secured debt obligation by the same borrower. Except as described in comment 2(p)–2, whether a refinancing has occurred is determined by reference to whether, based on the parties’ contract and applicable law, the original debt obligation has been satisfied or replaced by a new debt obligation. Whether the original lien is satisfied is irrelevant.

Credit Discrimination: 4(a) Data Format and Itemization

1. General. Except as otherwise provided in § 1003.3, § 1003.4(a) describes a financial institution’s obligation to collect data on applications it received, on covered loans that it originated, and on covered loans that it purchased during the calendar year covered by the loan/application register.

i. A financial institution reports these data even if the covered loans were subsequently sold by the institution.

Credit Discrimination: 4(f) Quarterly Recording of Data.

1. General. Section 1003.4(f) requires a financial institution to record the data collected pursuant to § 1003.4 on a loan/application register within 30 calendar days after the end of the calendar quarter in which final action is taken. Section 1003.4(f) does not require a financial institution to record data on a single loan/application register on a quarterly basis.

Credit Discrimination: 5(a) Reporting to Agency.

1. Quarterly reporting—coverage. i. Section 1003.5(a)(1)(ii) requires that, within 60 calendar days after the end of each calendar quarter except the fourth quarter, a financial institution that reported for the preceding calendar year at least 60,000 covered loans and applications, combined, excluding purchased covered loans, must submit its loan/application register containing all data required to be recorded for that quarter pursuant to § 1003.4(f).

Credit Discrimination: 5(b) Disclosure Statement.

1. Business day. For purposes of § 1003.5(b), a business day is any calendar day other than a Saturday, Sunday, or legal public holiday.

2. Format of notice. A financial institution may make the written notice required under § 1003.5(b)(2) available in paper or electronic form.

3. Notice—suggested text. A financial institution may use any text that meets the requirements of § 1003.5(b)(2). The following language is suggested but is not required:

Credit Discrimination: 5(c) Modified loan/application Register.

1. Format of notice. A financial institution may make the written notice required under § 1003.5(c)(1) available in paper or electronic form.

2. Notice—suggested text. A financial institution may use any text that meets the requirements of § 1003.5(c)(1). The following language is suggested but is not required:

Home Mortgage Disclosure Act Notice

Credit Discrimination: 5(e) Posted Notice of Availability of Data.

1. Posted notice—suggested text. A financial institution may post any text that meets the requirements of § 1003.5(e). The Bureau or other appropriate Federal agency for a financial institution may provide a notice that the institution can post to inform the public of the availability of its HMDA data, or an institution may create its own notice. The following language is suggested but is not required:

Home Mortgage Disclosure Act Notice

Credit Discrimination: 6(b) Bona Fide Errors.

1. Information from third parties. Section 1003.6(b) provides that an error in compiling or recording data for a covered loan or application is not a violation of the Act or this part if the error was unintentional and occurred despite the maintenance of procedures reasonably adapted to avoid such an error. A financial institution that obtains the required data, such as property-location information, from third parties is responsible for ensuring that the information reported pursuant to § 1003.5 is correct.

Credit Discrimination: Amendment History

[77 Fed. Reg. 8722 (Feb. 15, 2012); 77 Fed. Reg. 76,839 (Dec. 31, 2012); 78 Fed. Reg. 79,286 (Dec. 30, 2013); 79 Fed. Reg. 77,854 (Dec. 29, 2014); 80 Fed. Reg. 66, 317, 66,339 (Oct. 28, 2015); 81 Fed. Reg. 93,581 (Dec. 21, 2016); 82 Fed. Reg. 43,136, 43,145, 43,146,(Sept. 13, 2017); 82 Fed. Reg. 61,146 (Dec. 27, 2017); 84 Fed. Reg. 514 (Jan. 31, 2019); 84 Fed. Reg. 57,981, 58,003 (Oct. 29, 2019); 84 Fed. Reg. 69,994 (Dec. 20, 2019); 85 Fed. Reg. 28,404, 28,406 (May 12, 2020); 85 Fed. Reg. 83,410 (Dec. 22, 2020); 86 Fed. Reg. 72,819 (Dec. 23, 2021)]

Credit Discrimination: BOOKS

Chloe Thurston, At the Boundaries of Homeownership: Credit, Discrimination, and the American State (2018).

Dan Immergluck, Credit to the Community: Community Reinvestment and Fair Lending Policy in the United States (2004).

Discrimination in Financial Services: A Special Issue of the Journal of Financial Services Research (George J. Benston et al. eds., 1997).

Edward M. Gramlich, Subprime Mortgages: America’s Latest Boom and Bust (2007).

Gregory D. Squires & Charis E. Kubrin, Privileged Places: Race, Residence, and the Structure of Opportunity (2006).

Credit Discrimination: Introduction to State Credit Discrimination Laws

The following is a summary of state statutes prohibiting discrimination in credit. Some statutes are similar to the federal Equal Credit Opportunity Act. Some are part of a state civil rights or human rights act and are at least somewhat general in their application to consumer credit. As part of a general state civil rights code, there may be remedies or administrative procedures available modeled to varying degrees after those provided for in federal civil rights laws.

Credit Discrimination: ALABAMA

Fair Housing: Ala. Code §§ 24-8-1 to 24-8-15

Protected Classes: Race, color, religion, sex, familial status, national origin, handicap.

Prohibited Practices: Discriminating in providing financial assistance for the purchase, construction, repair, and maintenance of a dwelling.

Scope of Coverage: Businesses involved in realty-related transactions.

Exclusions: Too numerous to list, see § 24-8-7.

Credit Discrimination: ALASKA

Civil Rights: Alaska Stat. § 18.80.250 (credit transactions)

Protected Classes: Sex, physical or mental disability, marital status, changes in marital status, pregnancy, parenthood, race, religion, color, or national origin.

Prohibited Practices: Discriminating in transactions involving secured or unsecured credit, housing-related credit, credit for acquisition of unimproved property, credit to a married person or disabled person, credit card in the name of the married person requesting it.