The Consumer Financial Protection Bureau has proposed regulatory changes to allow lenders more flexibility in collecting demographic information.
According to the proposal, Regulation B, the bureau’s ruling in implementing the Equal Credit Opportunity Act, “prohibits a creditor from inquiring about the race, color, religion, national origin or sex of a credit applicant except under certain circumstances.”
The proposal aims to give mortgage lenders more flexibility in collecting consumer information regarding their ethnicity and race and to work better with Regulation C, which puts the Home Mortgage Disclosure Act into practice.
"This law is a key part of the government's commitment to root out discrimination," said CFPB Director Richard Cordray. "This proposal will help industry comply with the law and help protect consumers against illegal discrimination."
Perhaps the most important part of the proposal is its aim to widen credit availability to all capable applicants “without regard to race, color, religion, national origin, sex, marital status, or age (provided the applicant has the capacity to contract) and other protected characteristics.”
The CFPB is asking for public comment on the proposal, which will be implemented on Jan. 1, 2018.
To read the full proposal, click here.
CFPB included in new presidential order to reorganize the executive branch
Bank agrees to establish $1 million loan program to settle discrimination allegations