Do You Know Your Home Buyer Rights?
When you’re looking for a house, you want yourcredit history and your income to speak for you—not things like your race, gender or age.
While there are laws to protect buyers from discrimination by lenders, you still should be aware of your home buyer rights—especially if you think a lender may be ignoring them.
Equal Credit Opportunity Act
The Equal Credit Opportunity Act (ECOA) ensures only relevant factors are taken into account when considering your mortgage loan application. That means your income, assets, employment history and credit score can and will be analyzed, but a lender can’t discriminate against you for the following personal factors:
Home Mortgage Disclosure Act
Knowing these fats, it might lead you to wonder why is there a section asking for your gender, race and ethnicity on the mortgage application.
It’s actually there to protect buyers. That information is collected by the federal government—under the Home Mortgage Disclosure Act (HMDA)—in order to determine whether or not lenders are discriminating.
For example, if a lender is only approving applications from a specific demographic group, the government will notice and take action.
Marriage and Gender
A creditor cannot offer you a different loan program—like one with a higher interest rate—because of your gender, sexual preference or marital status.
Although creditors are allowed to ask if you are married, they are not allowed to discriminate against you based on your marital status. Keep in mind that if you are married and both spouses apply for the loan, the lender will take both incomes into consideration when determining your rate.
Creditors may ask if you are married, unmarried or separated—but they are not allowed to ask if you are widowed or divorced.
Children and Alimony
The creditor also must give you the option of including alimony or child support. If you need to include these in order to qualify for the income needed for the loan, you will need to disclose these. Otherwise you are under no obligation to tell them.
While the creditor is allowed to ask if you have to pay alimony or child support, a creditor may not ask if you plan to have children.
Age and Public Assistance
If you are over 62, age can be taken into account only when it favors your position. For example, lenders can’t penalize you for your age with higher interest rates, but they can offer you better deals because of it.
However, if you are about to retire, your lender can take that into consideration, because it affects your income and credit worthiness.
A creditor cannot discourage you from applying for a loan because you receive public assistance. Instead, lenders are required to view income from steady public assistance the same as steady income from other sources.
Acting to Protect Your Home Buyer Rights
If you feel your lender has discriminated against you, take action. Bring up the issue with your lender and see if they will reconsider your application.
If that does not work and you want to take further action, you can do the following to protect your home buyer rights:
- Contact your local Attorney General’s office.
- Report the lender to the relevant government agency, such as the Federal Trade Commission or Office of Fair Housing and Equal Opportunity.
- Sue the lender in federal district court.
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