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Equal Credit Opportunity Act (ECOA) / Regulation B Non-Discrimination Policy

Purpose:
The purpose of this policy is to ensure compliance with the Equal Credit Opportunity Act (ECOA) and Regulation B by prohibiting discriminatory practices in credit transactions. This policy reaffirms [Dealership Name]’s commitment to providing equal credit opportunities to all customers regardless of personal characteristics or protected classes.

1. Policy Statement

[Dealership Name] is committed to fair lending practices and prohibits discrimination in any aspect of a credit transaction. All credit applicants will be evaluated based on objective, legitimate creditworthiness criteria, and no individual will be treated unfairly based on protected characteristics.

2. Scope

This policy applies to all employees, contractors, and agents of [Dealership Name] who are involved in credit transactions, including but not limited to loan processing, credit decisions, and customer interactions.

3. Non-Discrimination Commitment

[Dealership Name] will not discriminate against any credit applicant on the basis of:

  • Race or color
  • Religion
  • National origin
  • Sex, gender identity, or sexual orientation
  • Marital status
  • Age (provided the applicant has the capacity to contract)
  • Receipt of public assistance income
  • Exercise of rights under the Consumer Credit Protection Act

4. Procedures

4.1 Credit Application Evaluation

  • Use standardized and consistent criteria to evaluate all credit applications.
  • Base credit decisions on relevant factors such as income, credit history, and employment status.
  • Document all decisions and ensure transparency in credit evaluations.

4.2 Adverse Action Notices

  • Provide a written notice of adverse action to applicants who are denied credit, as required by Regulation B.
  • Include the specific reasons for denial or information on how the applicant can request this information.
  • Ensure that notices comply with the timeline and content requirements of Regulation B.

4.3 Training

  • Provide regular training to all employees involved in credit transactions on:
    • ECOA/Regulation B requirements.
    • Recognizing and avoiding discriminatory practices.
    • Proper documentation and communication of credit decisions.

4.4 Customer Communication

  • Treat all customers with respect and provide clear, consistent information about credit terms and conditions.
  • Respond to inquiries and concerns related to credit applications promptly and professionally.

5. Monitoring and Auditing

  • Conduct periodic audits of credit applications and decisions to ensure compliance with this policy and Regulation B.
  • Review adverse action notices for accuracy and adherence to regulatory requirements.
  • Investigate any complaints or allegations of discrimination thoroughly and promptly.

6. Prohibited Practices

Employees must not:

  • Discourage or refuse to accept a credit application based on a protected characteristic.
  • Inquire about or consider prohibited factors, such as marital status or receipt of public assistance, unless specifically permitted by Regulation B.
  • Impose different terms or conditions on a credit transaction for individuals in a protected class.

7. Consequences for Non-Compliance

Failure to comply with this policy may result in:

  • Regulatory penalties for [Dealership Name], including fines or legal action.
  • Reputational harm to the dealership.
  • Disciplinary action for employees, up to and including termination of employment.

8. Policy Updates

This policy will be reviewed and updated annually or as changes to ECOA, Regulation B, or dealership practices occur.

Acknowledgment
I acknowledge that I have read and understand the ECOA/Regulation B Non-Discrimination Policy and agree to comply with its provisions.

Employee Signature: ___________________________
Date: ___________________________

Manager Signature: ___________________________
Date: ___________________________

This policy ensures [Dealership Name]’s compliance with ECOA/Regulation B and fosters a fair, inclusive, and legally compliant lending environment. Let me know if you need further customizations!