The Biden administration is taking steps to compel financial institutions to waive standard loan qualification criteria for undocumented immigrants.
Critics have raised fears that these lenient qualification standards might result in financial losses for lenders, which could ultimately impact American citizens.
Nevertheless, the Equal Credit Opportunity Act (ECOA), along with support from the Justice Department and the Consumer Financial Protection Bureau (CFPB), released a joint statement on Wednesday. This statement cautioned financial institutions that “all credit applicants are shielded from discrimination based on their national origin, race, and other characteristics covered by the (ECOA), irrespective of their immigration status.”
CFPB and DOJ issue joint statement on consideration of immigration status under ECOA but omit clear guidance https://t.co/CV2qoxUv22 #CFPB
— CFPB Watch (@CFPB_Watch) October 17, 2023
A statement from the Department of Justice Office of Public Affairs issued a statement noting that “consumers have reported being rejected for credit cards as well as for auto, student, personal and equipment loans because of their immigration status, even when they have strong credit histories and ties to the United States and are otherwise qualified to receive the loans.”
The statement quotes Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division and warned: “Lenders should not deny people the opportunity to take out a loan to buy a home, build their businesses or otherwise pursue their financial goals because of unlawful bias and without regard to their actual ability to repay.”
“This guidance reminds lenders that denying someone access to credit based solely on their actual or perceived immigrant status may violate federal law.”
Consumer Financial Protection Bureau Director Rohit Chopra said: “Fair access to credit is crucially important for building wealth and strengthening household financial stability. The CFPB will not allow companies to use immigration status as an excuse for illegal discrimination.”
The statement from the Department of Justice Office of Public Affairs emphasized that the Civil Rights Division upholds federal laws safeguarding individuals from discrimination, encompassing factors such as race, color, national origin, disability status, sex, religion, familial status, or the infringement of other constitutional rights. Those who suspected a financial institution had violated these regulations were urged to “file a complaint using our online form.”
In the joint statement, immigrants who believed they had been treated unfairly by a financial institution were encouraged to seek resolution through the CFPB’s website or by contacting (855) 411-CFPB (2372). The statement also mentioned a whistleblower hotline as an additional resource.
The Epoch Times reported it was “unclear whether any banks or financial institutions intend to challenge the DOJ and CFPB’s interpretation of the law regarding the provision of loans to illegal immigrants.”
