When you’re working with clients you need to know pretty early on whether they will be able to secure a loan and what kind of product they are pursuing. But what do you do if you think they may be being treated unfairly? Can you spot the signs of possible credit discrimination? Remember, both the Equal Credit Opportunity Act and the Fair Housing Act strictly prohibit discriminatory lending practices.
Always advise your clients to do their research and learn about credit, how it gets scored what impacts scores and how reporting agencies work. Instruct them to get a free copy of their credit report and review it for errors or omissions. Have them talk to a few lenders to learn about different products and the pros and cons of each of them. Encourage them to ask a lot of questions, and to work with a lender with whom they feel comfortable communicating. They will need to have good communication with them through the process. Of course, it helps if you have good relationships with a few lenders whom you know to be reliable and that you can recommend.
If your client is struggling to find a lender, ask a few questions to see if you notice any signs of credit discrimination. Often discrimination can be subtle or even hidden. Listen carefully to the answers your client gives you to see if you think they may have been treated differently based on their race, national origin, sex, or other protected groups. For instance, did they feel that they were discouraged from applying for credit, or did anyone make negative comments in the office? Were they denied without reason or offered a higher rate than the one for which they applied? Were they pressured to make a decision or treated differently in person?
If you believe a lender has discriminated against your client for any reason, you can advise your client to look into the matter and potentially file a complaint with the Consumer Finance Protection Bureau. They can look on the CFPB website or call their 800 number to get more information.
Even if they don’t choose to file a complaint, the CFPB wants to hear about consumer experiences. It’s helpful for them to know what issues consumers are facing on a daily basis. Have them visit http://www.consumerfinance.gov/fair-lending/.