Under What Circumstances Can the Loan Officer Ask about Robin Martin's Husband?
Question
Robin Martin made an individual application to the bank for a car loan. She has just returned to work on a regular basis because she was a full-time homemaker until recently, when her last child entered school. The loan officer would like to ask her about her husband. Under what circumstances can the officer ask Robin about her husband?
Answers
Explanations
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A. B. C. D.C
The loan officer may ask Robin Martin about her husband under certain circumstances that are legally permissible under the Equal Credit Opportunity Act (ECOA) and Regulation B. The ECOA is a federal law that prohibits creditors from discriminating against credit applicants based on factors such as race, color, religion, national origin, sex, marital status, or age. Regulation B is a set of rules that implements the ECOA and provides further guidance on how creditors must comply with the law.
Under Regulation B, a creditor may ask about a credit applicant's spouse or former spouse in certain limited circumstances. These circumstances are:
A. The creditor believes the spouse's signature will make the applicant more creditworthy. This means that the creditor has reason to believe that the applicant's creditworthiness may be improved by adding the spouse's income, assets, or credit history to the application.
B. The applicant is married. In this case, the creditor may ask about the spouse's name and other identifying information, but not about the spouse's income, assets, or credit history.
C. The applicant resides in a community property state. In these states, property acquired during marriage is generally considered jointly owned by both spouses. The creditor may ask about the spouse's income, assets, or debts if they are relevant to the loan application.
D. The applicant's credit reports indicate that the spouse is a better credit risk. In this case, the creditor may ask about the spouse's income, assets, or debts to verify the creditworthiness of the applicant and the spouse.
It is important to note that under the ECOA and Regulation B, a creditor cannot ask about a spouse's race, color, religion, national origin, sex, or age, or about any other factor that is not relevant to the credit application. Additionally, the creditor must treat all applicants equally, regardless of their marital status or any other protected characteristic.
In summary, the loan officer may ask Robin Martin about her husband under certain circumstances that are legally permissible under the ECOA and Regulation B, such as if the creditor believes the spouse's signature will make the applicant more creditworthy, or if the applicant resides in a community property state. However, the creditor cannot ask about a spouse's protected characteristics, and must treat all applicants equally.
