Finance
A buyer in Iowa applies for a mortgage and is turned down. Under ECOA, the lender must:
AProvide the borrower a free credit score only if requested
BProvide a written adverse action notice stating the reasons for denial within 30 days✓ Correct
CRefer the borrower to another lender within 10 days
DOffer a smaller loan amount as an alternative
Explanation
Under the Equal Credit Opportunity Act (ECOA), when a lender takes adverse action (such as denial of credit), the lender must provide a written adverse action notice within 30 days, stating the specific reasons for the decision. This helps borrowers understand and potentially address the issues.
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