Addressing credit discrimination

The CFPB is the first federal agency with the primary mission of making consumer financial markets work for American consumers. Congress charged us with ensuring that:

• All consumers have access to markets for consumer financial products and services; and
• Markets for consumer financial products and services are fair, transparent, and competitive.

Congress made fair lending and equitable access to credit an important piece of the Bureau’s design. It created the Office of Fair Lending & Equal Opportunity to focus on these issues. Congress also gave the CFPB authority over two key federal fair lending statutes. The CFPB has authority over the Equal Credit Opportunity Act, which prohibits discrimination against applicants in any type of credit transaction. This includes mortgages, car loans, student loans, and credit cards. The CFPB also has authority over the Home Mortgage Disclosure Act, which requires lenders to report mortgage data to allow for better fair lending enforcement.

The Office will play a lead role in the Bureau’s efforts to ensure fair, equitable, and nondiscriminatory access to credit for both individuals and communities. This includes providing oversight and enforcement of these important federal fair lending laws.

The Office has many tools that it can use to protect consumers from credit discrimination and promote fair access to credit. Working with other CFPB units, we can:

• Review lenders’ policies, procedures, and lending activity to detect and address potential discriminatory practices.
• Bring enforcement actions to stop discriminatory practices and remedy harm to consumers.
• Develop new policies, including rules about loan data collection required by Congress. These data will help ensure that lenders make credit available in a fair and non-discriminatory manner.
• Partner with private industry and fair lending, civil rights, consumer, and community advocates to promote fair lending compliance and education.
• Help ensure that consumers have the tools they need to make sound financial decisions and protect themselves from discriminatory practices.
• Assist in reviewing consumer complaints of unlawful discrimination. We can also review complaint patterns for early warnings about troubling lending practices. This data will help us in our supervision, enforcement, rule writing, and education efforts.
• Conduct research and analysis on equitable access to credit. This will include analyzing data collected under Federal regulations.
• Work with the Department of Justice, Department of Housing and Urban Development, Federal Trade Commission, and other federal and state agencies to make sure that our fair lending enforcement efforts are consistent, efficient, and effective.

Credit discrimination hurts both individual consumers and communities as a whole. It also prevents financial markets from working effectively. Fighting credit discrimination is a top priority of our Office.

We want to hear from you about your suggestions for our Office. If you have issues or questions that you would like us to consider, please let us know. If there are trends or data you would like us to review, let us know that as well. You can start by sharing this post with others, commenting below, or sending us an email.

Patrice Ficklin is the CFPB’s Assistant Director for the Office of Fair Lending & Equal Opportunity.