The Equal Credit Opportunity Act (ECOA) and the Fair Housing Act (FHA) protect you against discrimination when you apply for a mortgage to purchase, refinance, or make home improvements.

Your Rights Under ECOA
The ECOA prohibits discrimination in any aspect of a credit transaction based on:

• race or color;
• religion;
• national origin;
• sex;
• marital status;
• age (provided the applicant has the capacity to contract);
• the applicant's receipt of income derived from any public assistance program; and
• the applicant's exercise, in good faith, of any right under the Consumer Credit Protection Act, the umbrella statute that includes ECOA.

Your Rights Under FHA
The FHA prohibits discrimination in all aspects of residential real-estate related transactions, including:

• making loans to buy, build, repair, or improve a dwelling;
• selling, brokering, or appraising residential real estate; and
• selling or renting a dwelling.
• It also prohibits discrimination based on:
• race or color;
• national origin;
• religion;
• sex;
• familial status (defined as children under the age of 18 living with a parent or legal guardian, pregnant women, and people securing custody of children under 18); and
• handicap.

Lender Do's and Don'ts
Lenders must:

• consider reliable public assistance income in the same way as other income.
• consider reliable income from part-time employment, Social Security, pensions, and annuities.
• consider reliable alimony, child support, or separate maintenance payments, if you choose to provide this information. A lender may ask you for proof that this income is received consistently.
• if a co-signer is needed, accept someone other than your spouse. If you own the property with your spouse, he or she may be asked to sign documents allowing you to mortgage the property.

Lenders cannot:

• discourage you from applying for a mortgage or reject your application because of your race, national origin, religion, sex, marital status, age, or because you receive public assistance income.
• consider your race, national origin, or sex, although you will be asked to voluntarily disclose this information to help federal agencies enforce anti-discrimination laws. A creditor may consider your immigration status and whether you have the right to remain in the country long enough to repay the debt.
• impose different terms or conditions, such as a higher interest rate or larger down payment, on a loan based on your race, sex, or other prohibited factors.
• consider the racial composition of the neighborhood where you want to live. This also applies when the property is being appraised.
• ask about your plans for having a family. Questions about expenses related to your dependents are permitted.
• refuse to purchase a loan or set different terms or conditions for the loan purchase based on discriminatory factors.
• require a co-signer if you meet the lender's standards.

If Your Application Is Rejected
If your mortgage is denied, the lender must give you specific reasons why or tell you of your right to ask for them. Under the law, you have the right to:

Know within 30 days of the date of your completed application whether your mortgage loan is approved. The lender must make a reasonable effort to obtain all necessary information, such as credit reports and property appraisals. If your application is rejected, the lender must tell you in writing.

Know specifically why your application was rejected. The lender must tell you the specific reason for the rejection or your right to learn the reason if you ask within 60 days. An acceptable response might be: "your income was too low" or "you haven't been employed long enough." A response of "you didn't meet our minimum standards" is not specific enough.

Learn the specific reason why you were offered less favorable terms than you applied for, but only if you reject these terms. For example, if the lender offered you a smaller mortgage or a higher interest rate, you have the right to know why if you did not accept the lender's counter offer.

Find out what is in your credit report. The lender may have rejected your application because of negative information in your credit report. If so, the lender must tell you this and give you the name, address, and phone number of the credit bureau. You can get a free copy of that report from the credit bureau if you request it within 60 days. Otherwise, the credit bureau can charge up to $8.

If your report contains inaccurate information, the credit bureau is required to investigate items that you dispute. Those companies furnishing inaccurate information to the credit bureaus also must reinvestigate items that you dispute. If you still dispute the credit bureau's account after a reinvestigation, you can include your summary of the problem in your credit report.