Proposed Rule Would Decimate Fair Lending Protections and Make Buying a Car or Home Harder
WASHINGTON – A proposal by the Consumer Financial Protection Bureau (CFPB) to gut fair lending protections under the Equal Credit Opportunity Act (ECOA) would deal a devastating blow to the many groups of people who have been discriminated against when they tried to buy a car or house or start a small business. Women, Black people, Latinos, servicemembers and veterans, Native Americans, and older adults are among the groups who will find it more expensive to get loans.
The National Consumer Law Center (NCLC), on behalf of its low-income clients, submitted comments warning that the rule would undermine key fair lending protections, leave consumers at risk of discrimination, and reduce access to a fair and competitive credit market in the midst of an affordability crisis.
“The administration’s proposed changes to the ECOA represent a radical departure from the law’s core mission to protect consumers from discrimination,” said Odette Williamson, director of Racial Justice Advocacy at the National Consumer Law Center. “The move to gut fair lending protections will leave people vulnerable to discrimination in the credit market and increase the cost of lending for women, Black people, servicemembers and veterans, older people, and Native Americans, among other groups.”
The ECOA is a landmark law passed by Congress in 1974 to remedy systemic discrimination in access to credit for consumers and businesses. Prior to its passage, many women were unable to get mortgages or other loans without a male co-signer. The law prohibits credit discrimination on the basis of race, color, religion, national origin, sex, marital status, age, the receipt of public assistance benefits, and exercising rights under the federal Consumer Protection Act.
The history of discrimination in the credit marketplace and its enduring legacy is extensive, and includes current forms of predatory and high-cost lending, redlining, reverse redlining, and other racially exclusionary practices. These practices created credit deserts, cutting communities off from affordable credit while inundating those same communities with expensive and risky predatory loans.
“Consumers in every category or class covered by the ECOA bear the brunt of decades of government-sanctioned predatory and discriminatory practices,” said Jeremiah Battle, Jr., senior attorney at NCLC. “This rule would invite discrimination to persist in the credit market and create barriers to economic stability and advancement for individuals, families, and whole communities.”
The ECOA contains critical protections against credit discrimination targeting consumers who have exercised their rights under the Consumer Credit Protection Act, including holding debt collectors accountable for harassing debt collection, illegal wage garnishment, and improper credit reporting. With debt collection numbers rising, and overall consumer debt increasing, relaxing protections for people from illegal and harassing conduct in debt collection is dangerous. The proposed rule invites lenders to deny or discourage potential borrowers they perceive as problematic or prone to filing complaints.
“The Proposed Rule should be withdrawn in its entirety,” Battle said.
Related Resources
- Fact Sheet: CFPB Proposes to Gut Credit Discrimination Protections, November 2025
- Press Release: Presidential Action Enables Discrimination in Housing and Lending, April, 25, 2025
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