Our Commitment to Fair Lending
JSC Federal Credit Union (JSC FCU) does not tolerate any form of discrimination. We are committed to lending practices that are fair and nondiscriminatory. As part of our commitment to provide fair lending, JSC FCU requires its officers, employees, agents, and third-parties with whom we deal to act in accordance with the letter and spirit of all fair lending laws and regulations in all aspects (including marketing credit products, the application and process, credit decisions, servicing, collection, and foreclosure activities) without regard to:
- Marital status
- National Origin
- Familial status
- Military status
- Political affiliation
- Sexual orientation
- Receipt of public assistance or unemployment
- Good faith exercise of any rights under the Consumer Protection Act
Equal Credit Opportunity Act REG. B (ECOA)
ECOA prohibits discrimination in any aspect of a credit transaction based on the following characteristics:
- Age (provided the applicant has the capacity to contract)
- Race or color
- National Origin
- Marital status
- Applicant's receipt of income received from any public assistance program
- Applicant's exercise, in good faith, or any rights under the Consumer Credit Protection Act
NOTE: ECOA covers all extensions of credit and certain technical requirements that are meant to help further the purpose of ECOA.
Fair Housing Act (FHAct)
The Fair Housing Act prohibits discrimination in all attributes of real estate related transactions including:
- Making loans to buy, build, repair or improve a dwelling
- Purchasing real estate loans
- Selling, brokering or appraising residential real estate
- Selling or renting a dwelling
Discrimination based on:
- Race or color
- National origin
- Familial status (Defined as children under the age of 18 living with a parent or legal custodian, pregnant women, and people securing custody of children under 18)
In determining the:
- Interest rate
- Other credit terms
NOTE: FHA is limited to residential real estate related transactions or a loan secured by residential real estate transactions and does not have technical requirements.
Home Mortgage Disclosure Act (HMDA) REG. C
HMDA disclosure law requires financial institutions to maintain, report, and disclose loan-level information for home purchase, refinance and home improvement loans. This allows both regulators and the public to track responsiveness to the home financing needs of communities in which business is conducted. The information reported includes income, race, sex, geographic area, pricing, and other factors.
Prohibited Discrimination Factors
If a credit, pricing, or other decision is made on a prohibited basis, it is a violation of the fair lending laws and regulations. Below are examples of actions a lender may not take because of a prohibited factor and characteristics that cannot be used to discriminate on a prohibited basis.
Examples of Prohibited Discrimination Factors
- Failure to provide information or services or providing different information or services regarding any aspect of the lending process, including credit availability, application procedures, or lending standards.
- Discouraging or selectively encouraging applicants with respect to inquiries about or applying for credit
- Using different standards in determining whether to extend credit including, varying terms of credit including amount offered, interest rate, duration, or type of loan to similarly qualified applicants.
- Using different standards to evaluate collateral
- Treating borrowers differently in loan servicing or default
- Using different standards for pooling or packaging a loan in the secondary market.
Examples of Prohibited Characteristics
- The applicant, prospective applicant or borrower
- Any person associated with an applicant, prospective applicant, or borrower
- The present or prospective occupants of either the property to be financed or the characteristics of neighborhood or other areas where property to be financed is located.
- Reasonable accommodations for a person with disabilities when necessary to afford the person an equal opportunity to apply for credit.
JSC FCU must not:
- Engage in any form of advertising of mortgage loans which indicate there is discrimination on a prohibited basis.
- Advertisements must not contain any words, symbols, models, or other forms of communication that suggest a discriminatory preference or policy of exclusion
- Advertisements of real estate products must include a facsimile of the prescribed equal housing lender logo (for written advertisements) or prescribed language (for oral advertisements).
Types of Lending Discrimination
Courts have recognized three methods of identifying lending discrimination under the ECOA and FHAct.
There is overt evidence of discrimination when a lender:
- Openly discriminates on a prohibited basis
- When a lender expresses but does not act on a discriminatory preference
This type of disparate treatment occurs when a lender treats a credit applicant differently based on one of the prohibited bases. It does not require any showing that the treatment was motivated by prejudice or a conscious intention to discriminate against a person beyond the difference in treatment itself.
When a lender applies a racially or otherwise neutral policy or practice disproportionately excluded or burdens certain persons on a prohibited basis, the policy or practice is described as having a “disparate impact”.
Example: Income standard for credit applicants
JSC FCU’s policy is to adhere to and promote compliance with all applicable state and federal laws and regulations. JSC FCU ensures fair lending and equal access to credit, including but not limited to the ECOA and the FHAct.