National Credit Union Administration Chairman Todd Harper this week warned credit unions to ensure that their policies are consistent with a new Consumer Financial Protection Bureau policy that prohibits discrimination based on sexual orientation and/or gender identity.
In a letter to credit unions, Harper also said that credit unions should review automated scoring, decision and pricing models for variables that could be proxies for such discrimination. He noted that some state laws already prohibit discrimination in credit transactions based on sexual orientation or gender identity.
In March, the CFPB announced that it will interpret the Equal Credit Opportunity Act and its rules to prohibit discrimination based on sexual orientation or gender identity.
The CFPB said that it intends to review agency publications and guidance for examiners and revise them to take into account the change. The agency also said it would take enforcement actions based on the new policy. Since the agency issued the policy as an interpretative rule, the CFPB was not required to open it for comment by the public.
Jesse Van Tol, chief operating officer of the National Community Reinvestment Coalition, said after the CFPB announced its decision that such discrimination is a problem.
“A recent NCRC study on mortgage lending showed that same-sex couples are significantly less likely than different-sex couples to be approved for mortgage loans,” Van Tol said. “It also showed that the same-sex couples who are approved for mortgage loans pay higher interest rates and closing costs for mortgages. This kind of discrimination should have been stopped long ago.”