Consumer credit and its necessity:

Every individual requires credit for better lifestyle, purchasing a house, starting a business, re modeling an existing home etc. as all these depends upon credit. The Equal Credit Opportunity Act facilitates consumers to enjoy equal opportunities for obtaining credit; but the whole thing depends upon existing debt, credit history, income, creditworthiness, expenses etc. While dealing with varied creditors like credit card companies, credit unions , retail and departmental stores, financial institutions like banks and small loan companies, it has been revealed many times equal opportunity gets distorted. The law protects every consumer to deal with the creditors whenever any malpractice crops up.

Disparity: As it is The FRB Boston study highlighted the disparity among the mortgage lenders in dispatching loans to the consumers. This is utter violation to the law; again many instances are found where the consumers receive unequal treatment. Discrimination within the whites and the minorities popped up in transactions of mortgage lenders are now considered suspect under Fair Lending Laws.

Banking regulators are investigating their behavior. Data, highlighting unlawful disparity will exert tremendous pressure upon Federal Banking regulators and US Department of Housing and Loan. This indeed hampers the credit scores considerably.
As equal consumer opportunity distorted
In the recent past, Chicago witnessed a strong correlation between minorities and mortgage discrimination. The minorities even with fair enough credit score were refused to obtain credit- this further lead to unfriendly relationship among the neighbors. Census tracked during 1990 proves more than 50% disapprovals comprised the minorities. Title VIII of the Civil Rights Act of 1968 and the Equal Credit Opportunity Act of 1976, being combined, prohibit discrimination against mortgage applicants. Statutory Laws are prominent over the years but hardly steps were taken to suppress disparity in behavior of the lenders. Though, it may be said that lack of publicity of these data was the major cause for lack of actions. Moreover, loans by credit organizations may affect credit score. Mortgage lending rate is comparatively lower in case of African and Latin neighborhoods compared to white neighborhoods. Residents of minor neighborhoods do not enjoy equal opportunity like those of white neighborhoods. The Equal Credit Opportunity Act ensures a person if discriminated can check it with The Sate Attorney General. Whenever a consumer proves in a court any discrimination from the agency's end, the court fees are totally reimbursed and compensated. Joining with other class action suite provides punitive damages for the group up to $500,000. People should come forward with more awareness about legal procedures and against undue discrimination. Rejection by several credit organizations results in poor credit report. This leads to further trouble and confusion regarding future financial conditions. Re-scoring is truly difficult and involves risk.

Who is the final Judge?

Federal law attempts to prevent discrimination on Consumer Finance for better practice of equal consumer credit opportunity. US Civil Rights are highly in practice and properly protected, residents should play a proactive part in preservation of the rights. After the Los Angeles riots, several press highlighted discrimination and the true scene; unbiased contribution from the Fourth Estate was praiseworthy. Still the victims have to carry out the final countdown to supplement inequality in consumer credit.