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What should I do if I think that a lender or auto dealer discriminated against me in my auto loan application, such as by denying my application or charging me a higher interest rate?

If you are denied an auto loan, you should receive information about why you were denied. If you believe that your lender or dealer discriminated against you can file a complaint with the FTC, CFPB, or with your state attorney general or state consumer protection office.

The Equal Credit Opportunity Act makes it illegal for a creditor such as a lender or dealer to discriminate against any applicant in any aspect of a credit transaction, including auto loans, because of:

  • Race
  • Color
  • Religion
  • 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. This includes, but is not limited to, social security and supplemental security income (SSI), unemployment compensation, Temporary Assistance to Needy Families (TANF), and Supplemental Nutrition Assistance Program (SNAP).
  • Exercising in good faith a right under the Consumer Credit Protection Act, which includes consumer protection statutes relating to credit

This means that a lender or dealer may not use any of the above grounds as a reason to:

  • Refuse you an auto loan if you qualify for it
  • Discourage you from applying for an auto loan
  • Provide you an auto loan 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 account

If you are denied an auto loan, you should receive information about why you were denied. This is called an “adverse action notice.” This notice includes a statement of the specific reasons for the denial or a notice that you may request a statement of specific reasons within 60 days.

If you believe that your lender or dealer discriminated against you on any of these grounds, you can submit a complaint with the Federal Trade Commission (FTC) or with the CFPB online or by calling us toll-free at 1-855-411-CFPB (2372). You can also tell us your experience without submitting a formal complaint.

You can also file a complaint with your state attorney general or state consumer protection office . If you’re in the military, you should report this to your installation JAG immediately. To find your JAG Legal Assistance Office use the locator .

In addition, state or local law may prohibit discrimination on additional grounds.

TIP:

Watch for warning signs

Credit discrimination is often hidden or even unintentional, which makes it hard to spot. Look for red flags, such as:

  • You are treated differently in person than on the phone.
  • You are discouraged from applying for credit.
  • You hear the lender make negative comments about race, national origin, sex, or other protected characteristics.
  • You are refused credit even though you qualify for it.
  • You are offered credit with a higher rate than the one you applied for, even though you qualify for the lower rate.
  • You are denied credit, but not given a reason why or told how to find out why.
  • Your deal sounds too good to be true.
  • You feel pushed or pressured to sign.

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