Fair Housing
Disparate treatment occurs when a lender or real estate professional:
AUses a neutral policy that disproportionately harms a protected class
BIntentionally treats a person differently because of their membership in a protected class✓ Correct
CFails to advertise to all demographic groups
DApplies the same standards to all applicants regardless of protected class
Explanation
Disparate treatment is intentional discrimination — treating a person differently because of their protected class characteristic. It requires evidence of discriminatory intent, unlike disparate impact, which can be proven statistically without showing intent.
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Key Terms to Know
Adjustable-Rate Mortgage (ARM)
A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
Debt-to-Income Ratio (DTI)A lender's measure of a borrower's monthly debt obligations relative to their gross monthly income, used to evaluate loan eligibility.
Deed of TrustA security instrument used in many states instead of a mortgage, involving three parties: borrower (trustor), lender (beneficiary), and a neutral trustee.
Fair Housing ActFederal law prohibiting discrimination in the sale, rental, or financing of housing based on race, color, national origin, religion, sex, disability, and familial status.
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