CFPB & DOJ Joint Statement on Fair Lending for Noncitizen Borrowers Summary
Updated 11/13/2023
This tool summarizes the recent Joint Statement issued by the CFPB and Department of JusticeĀ on the potential civil rights implications that can come up when a creditor considers an individualās immigration status under the Equal Credit Opportunity Act (ECOA). Technically, ECOA does not prohibit consideration of immigration status, and so a creditor may consider immigration status when necessary to ascertain rights regarding repayment. However, the Statement makes clear that creditors need to be aware that āunnecessary or overbroad reliance on immigration status in the credit decisioning processā can give rise to potential violations of ECOAās antidiscrimination provisions, in addition to other laws. While the Statement indicates that it is āfor informational purposes only,ā it is likely indicative of the CFPBās and DOJās, and perhaps even other agenciesā, current expectations.
The following are the key takeaways of the changes:
- ECOA technically does not prohibit consideration of immigration status.
- However, the only example of an allowance in Reg B is that a creditor may consider immigration status when necessary to ascertain its rights regarding repayment.
- Beyond this, the Statement makes clear that a creditorās āunnecessary or overbroad reliance on immigration status in the credit decisioning processā can give rise to violations of ECOA, Reg B, and 42 U.S.C. Ā§ 1981, discussed further below.
Members Can Download This Tool
Login to Download
Not Yet a Member?
Our members enjoy:
On-demand regulatory guidance hotline ā by chat, phone and email ā available from anywhere, on any device ā 7 am - 6 pm, M-F, Central time
Research time saved daily & weekly across forms, checklists, and trainings ā for every regulation
Hours of form-building and branding of bank documents saved; in some cases, even the budget of additional staff
A sounding board for support and reassessment when institutional goals or the regulatory environment changes
Access to attorneys and compliance specialists for risk modelling and decision-making in advance of large business decisions
The knowledge that C/A was created and owned by 30 State Bankers Association to provide bank compliance services to their membership organizations
Find out how a personalized team of attorneys and compliance professionals helps build targeted compliance strategies throughout your institution when you take our Live Membership Demo.