Fair Housing
A Utah lender who offers minority borrowers only adjustable-rate or subprime loans while offering comparable white borrowers fixed-rate conventional loans is engaged in:
AReverse redlining or predatory lending based on race✓ Correct
BAppropriate risk-based pricing
CA legal differential pricing strategy
DCommunity Reinvestment Act compliance
Explanation
Steering minority borrowers into worse loan products (reverse redlining) based on race violates the Fair Housing Act, ECOA, and other federal laws, regardless of the borrower's creditworthiness.
People Also Study
Related Utah Questions
- In Utah, when a borrower defaults on a trust deed loan, the lender typically uses:Finance
- A Utah mortgage lender who charges a higher interest rate to a borrower of a specific race, despite the borrower qualifying for a lower rate, is committing:Finance
- The federal Fair Housing Act prohibits discrimination based on all of the following EXCEPT:Fair Housing
- A USDA-guaranteed loan in Utah offers what advantage to the lender?Finance
- A Utah landlord refuses to accept a prospective tenant's service animal, saying it violates the no-pets policy. Under fair housing law:Fair Housing
- A Utah lender offering a 'no-doc' or 'stated income' loan would be:Finance
- The Utah Fair Housing Act provides protections that are:Fair Housing
- Under the federal Fair Housing Act, which of the following is NOT a protected class?Fair Housing
Key Terms to Know
Fair Housing Act
Federal law prohibiting discrimination in the sale, rental, or financing of housing based on race, color, national origin, religion, sex, disability, and familial status.
SteeringAn illegal practice where a real estate agent directs buyers toward or away from certain neighborhoods based on the buyer's race, religion, national origin, or other protected characteristics.
RedliningAn illegal practice where lenders or insurers deny services or charge higher rates in certain neighborhoods based on the racial or ethnic composition of those areas.
Private Mortgage Insurance (PMI)Insurance required by lenders on conventional loans with less than 20% down payment, protecting the lender — not the borrower — against default.
Study This Topic
Practice More Utah Real Estate Questions
1,500+ questions covering all exam topics. Start free — no signup required.
Take the Free Utah Quiz →