Question

what is one practice outlawed by the equal credit opportunity act (ecoa)?

offering discounts based on marital status
denying credit based on political affiliation
providing special offers based on age
charging higher interest rates based on race

Explanation:

Identify the core purpose of the Equal Credit Opportunity Act (ECOA)

The Equal Credit Opportunity Act (ECOA), enacted in 1974, is a federal law that makes it unlawful for any creditor to discriminate against any applicant, with respect to any aspect of a credit transaction, on the basis of race, color, religion, national origin, sex, marital status, age, or because they receive public assistance.

Evaluate the given options against the ECOA provisions

• Offering discounts based on marital status: The ECOA prohibits discrimination in credit transactions, but offering promotional discounts is generally not a credit-denial or credit-pricing violation under this specific act.
• Denying credit based on political affiliation: Political affiliation is not a protected class under the ECOA.
• Providing special offers based on age: The ECOA allows for certain age-based credit programs (such as favorable terms for seniors), so this is not a prohibited practice.
• Charging higher interest rates based on race: Race is a strictly protected class under the ECOA. Charging higher interest rates or offering worse credit terms based on race constitutes unlawful discrimination.

Answer:

• Offering discounts based on marital status
• Denying credit based on political affiliation
• Providing special offers based on age
• Charging higher interest rates based on race (Correct answer)