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Q: Banking Laws & Practices ( Answered 3 out of 5 stars,   1 Comment )
Subject: Banking Laws & Practices
Category: Miscellaneous
Asked by: cidly-ga
List Price: $10.00
Posted: 26 Jul 2002 08:33 PDT
Expires: 25 Aug 2002 08:33 PDT
Question ID: 45437
Joan is a married woman in California with four children.  She seeks a
home loan but is informed by the bank that it is against bank policy
to lend money to a married woman unless her husband co-signs.  What
California and Federal Codes is the bank in violation of?
Subject: Re: Banking Laws & Practices
Answered By: wengland-ga on 26 Jul 2002 12:25 PDT
Rated:3 out of 5 stars

Teach me to post too soon.  Found the California reference as well.

The lender, in discouraging the woman from applying for credit because
of her marital status, is violatiing the Federal Equal Credit
Opportunity Act, as referenced in this page: 

As well as violating the Housing Financial Discrimination Act of 1977
California Fair Lending Notice as established in Section 7114 of the
California Fair Lending Regulations (Title 21, Subchapter 4, Code of

Text of Section 7105.2 from this link (not sure if it'll work):{53761}&softpage=Document42&x=43&y=15&zz=

"Section 35811 of the Act and 7105(a)(2) prohibit discrimination on
the basis of sex and marital status. These regulations codify, and
incorporate by reference, all federal and state laws governing such
discrimination, including, but not limited to, the Federal Equal
Credit Opportunity Act, the Federal Fair Housing Act, the National
Housing Act, the California Unruh Civil Rights Act, the Rumford Fair
Housing Act and the provisions of the California Civil Code commencing
with Section 1812.30. For purposes of example, a financial
institutions shall consider the following:
(a) Financial institutions shall consider without prejudice the
combined incomes of both husband and wife;
(b) Sex discrimination against any person seeking financial assistance
with respect to any aspect of the transaction is prohibited;
(c) Refusing to lend, requiring higher standards of creditworthiness
of, or imposing different terms on, members of one sex or individuals
of one marital status is discriminatory based upon sex or marital
status. Loan underwriting decisions must be based upon an applicant's
credit history and present and reasonably foreseeable economic
prospects, rather than on the basis of assumptions regarding
comparative differences in creditworthiness between married and
unmarried individuals, or between men and women; and
(d) A practice of discounting all or part of either spouse's income
where both spouses apply jointly may discriminate on the basis of sex.
As with other income, when spouses apply jointly, determination as to
whether or not a spouse's income qualifies for credit purposes should
depend upon a reasonable evaluation of his or her past, present, and
reasonably foreseeable economic circumstances."

If that link fails, go here:

and click on Title 21, Division 3, Chapter 4, Article 2 in the left
frame, and you'll get to the relevant code.

I hope this answers your question; if you need further information,
feel free to ask for a clarification before rating the answer.


Search Strategy:


equal lending laws


california fair lending notice

california fair lending regulations
cidly-ga rated this answer:3 out of 5 stars

Subject: Re: Banking Laws & Practices
From: wengland-ga on 26 Jul 2002 12:11 PDT
Sounds like homework to me, but best guess is the  EQUAL CREDIT
OPPORTUNITY ACT, referenced here:

Sorry, no California info yet.

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