What do I do if I think a student loan lender discriminated against me?
Under the Equal Credit Opportunity Act, it is illegal for a creditor or lender to discriminate against an applicant based on a number of factors.
- National origin
- Sex (including sexual orientation and gender identity)
- Marital status
- Age (if the applicant is old enough to enter into a contract)
- Receipt of income from any public assistance program
- Exercising in good faith a right under the Consumer Credit Protection Act, which includes consumer protection statutes relating to credit.
State or local law may prohibit discrimination on additional grounds.
This means that a creditor may not use any of the above grounds as a reason to:
- Refuse you credit if you qualify for it
- Discourage you from applying for credit
- Provide you credit on terms that are different from the terms given to someone else who is similarly situated to you, such as having similar creditworthiness
- Close your existing account
If you are applying for a student loan in your own name, a creditor may not deny you credit because of your marital status. If you are creditworthy, you may get your own credit, and a creditor generally may not require that your spouse co-sign your account.
Generally, a creditor may request information about your spouse or former spouse only in certain cases:
- Your spouse or former spouse will be responsible for paying debts on the account.
- You are relying on your spouse’s income or former spouse’s income to repay the credit requested.
- You are relying on alimony, child support, or separate maintenance payments from a spouse or former spouse to repay the credit requested.
Sex or gender
A creditor generally may not ask applicants for student loans about their sex or the sex of a co-signer on an application form. However, a creditor may ask applicants to select a title (Mr., Miss, Mrs., or Ms.) on the application form, if the form states this is optional.
Citizenship or national origin
A creditor cannot discriminate on the basis of national origin. However, a creditor may ask about your permanent residency and immigration status or the residency or immigration status of any co-signer. A creditor may consider this information or any additional information that may affect its rights and remedies regarding repayment.
A creditor may also take into account any law, regulation, or executive order that limits dealings with citizens of certain countries.
Generally, a creditor cannot use your age to make credit decisions. However, there are exceptions to this rule.
For example, age can be considered in a valid credit scoring system. A creditor may also relate your age to other information about you that the creditor considers in evaluating creditworthiness, such as your lack of job history.
Children or dependents
A creditor may ask about the number and ages of your dependents. A creditor may also ask about dependent-related financial obligations or expenses. However, a creditor may do so only if the creditor asks for this information without regard to sex or marital status (or any other prohibited basis).
A creditor cannot ask you about your birth control practices. A creditor also cannot ask about your intentions concerning having or raising children or your capability to have children.
Income from alimony or child support
As with all other forms of income, a creditor can consider your income from child support or alimony. In determining the amount of payments and the likelihood that payments will continue, a creditor may consider factors such as whether there is a written agreement or court decree, how long and how regularly you or your co-signer have been receiving payments, and the creditworthiness of the payor when that information is available.
Income from a public assistance program
A creditor cannot discriminate against you because you (or your co-signer) receive or have received public assistance income.
Like any other income, a creditor may consider whether you or your co-signer’s public assistance income is likely to continue. If that income is not likely to continue, that fact can be considered in determining creditworthiness.
What to do if you were discriminated against in your student loan application
If you believe that you were discriminated against on any of these grounds, you can file a complaint with the CFPB online or toll-free at (855) 411-CFPB (2372).