Loan Officer Federal Laws: ECOA Questions and Answers

Question 1

Under the Equal Credit Opportunity Act (ECOA), a creditor must provide a copy of the appraisal report used for a loan secured by a dwelling. When must the creditor provide this copy to the applicant?

Accepted Answer

Promptly upon completion, or no later than three business days before consummation.

Answer

Within 30 days of the loan closing.

Answer

Upon the applicant's written request, after the loan has been funded.

Answer

Only if the loan application is denied.

Question 2

A loan applicant is denied credit. According to ECOA, how long does the creditor have to notify the applicant of the adverse action taken?

Accepted Answer

Within 30 days of receiving a completed application.

Answer

Within 15 days of receiving the completed application.

Answer

Within 60 days of taking adverse action.

Answer

Within 90 days if a counteroffer was made and not accepted.

Question 3

Which of the following is NOT a protected class under the Equal Credit Opportunity Act?

Accepted Answer

Immigration status

Answer

Receipt of public assistance income

Answer

Marital status

Answer

Age

Question 4

A loan officer is taking an application for a mortgage. Under what circumstances is it permissible to ask about the applicant's marital status?

Accepted Answer

If the loan will be secured by the property being purchased.

Answer

Only if the applicant is female.

Answer

It is never permissible to ask about marital status.

Answer

To determine if the applicant is likely to have children.

Question 5

A mortgage lender receives a loan application on March 1st. On March 10th, the lender issues a denial. For how long must the lender retain the application and any related documentation according to ECOA?

Accepted Answer

25 months

Answer

12 months

Answer

36 months

Answer

5 years

Question 6

A lender makes a statement to a potential applicant that they "tend to avoid making loans in that part of town because of the high number of renters." Which specific provision of ECOA would this statement most likely violate?

Accepted Answer

The prohibition against discriminatory discouragement.

Answer

The requirement for an Adverse Action Notice.

Answer

The rules on providing appraisal copies.

Answer

The limitations on requesting information about a spouse.