Question 40
Domain 1: Federal Mortgage-Related LawsECOA prohibits credit discrimination based on all of the following EXCEPT:
Correct answer: C
Explanation
The Equal Credit Opportunity Act bars discrimination in credit transactions based on protected characteristics such as race, color, religion, national origin, sex, marital status, age, and receipt of public assistance. A credit score is not a protected class under ECOA, so it is not one of the prohibited bases for discrimination.
Why each option is right or wrong
A. Marital status
B. Receipt of public assistance income
C. Credit score
Under the Equal Credit Opportunity Act, 15 U.S.C. § 1691(a) and Regulation B, 12 C.F.R. § 1002.4(a), creditors may not discriminate on the basis of race, color, religion, national origin, sex, marital status, age, or receipt of public assistance, and they may not penalize an applicant for exercising rights under the Consumer Credit Protection Act. A credit score is not one of the statute’s protected bases; it is an underwriting factor a creditor may consider, so it is the only choice that is not prohibited by ECOA.
D. National origin