Finance
Under the Equal Credit Opportunity Act (ECOA), a lender in Virginia may NOT discriminate in lending based on:
ACredit score
BDebt-to-income ratio
CRace, color, religion, national origin, sex, marital status, or age✓ Correct
DEmployment history
Explanation
ECOA prohibits lending discrimination based on race, color, religion, national origin, sex, marital status, age, or receipt of public assistance. Lenders may still use creditworthiness factors like credit score and DTI ratio.
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Key Terms to Know
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.
Discount PointsPrepaid interest paid to a lender at closing to reduce the mortgage interest rate, with each point equal to 1% of the loan amount.
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.
Pre-ApprovalA lender's conditional commitment to loan a specific amount to a borrower, based on verified income, credit, and assets.
Math Concepts
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