Which law prohibits discrimination by lenders against borrowers using public assistance?

The Equal Credit Opportunity Act (ECOA) is the law that specifically prohibits lenders from discriminating against borrowers based on various factors, including the use of public assistance as a source of income. The ECOA aims to ensure fair access to credit and requires lenders to evaluate all applicants fairly, treating them equally regardless of their race, color, religion, national origin, sex, marital status, age, or receipt of public assistance.

Under the ECOA, it is illegal for lenders to refuse loans or impose different terms solely because an applicant relies on public assistance to qualify for credit. This means that individuals who receive government aid cannot be denied loans or charged higher interest rates simply due to the fact that their income includes public assistance.

While the Fair Housing Act addresses discrimination in housing-related transactions and the Home Mortgage Disclosure Act focuses on the transparency of lending practices and monitoring for patterns of discrimination in mortgage lending, they do not provide the same level of protection concerning the use of public assistance in obtaining credit. The Truth in Lending Act is primarily concerned with ensuring that consumers are informed about the costs of credit and the terms of loans, rather than addressing discrimination in lending practices.