Before the team acts on a supervisory file review, the file reviewer must address ECOA Income Consideration. Which response is most defensible?

Correct Answer

A) Evaluate credit without prohibited-basis discrimination

Why this is correct: The Equal Credit Opportunity Act (ECOA) and its implementing Regulation B prohibit discrimination in any aspect of a credit transaction based on a prohibited basis such as race, color, religion, national origin, sex, marital status, age, or income from public assistance. A creditor must evaluate credit applications based on the applicant's actual creditworthiness, not on prohibited factors. The correct answer, "Evaluate credit without prohibited-basis discrimination," is the central mandate of ECOA, as supported by the original explanation. Why the other choices are wrong: "Use an internal exception instead of the required federal disclosure or timing rule" is wrong because internal policies cannot create exceptions to federal anti-discrimination law. "Wait until a regulator asks for the file before applying the federal requirement" is wrong because ECOA compliance is mandatory from the point of application; waiting for a regulator is not a defense. "Rely on oral agreement when the rule requires documented compliance" is wrong because ECOA has specific requirements for written notices (like adverse action notices) and providing copies of appraisals; oral agreements do not fulfill these documentation duties. Exam tip: Remember that ECOA's core purpose is to prevent discrimination. Any answer choice that allows for differential treatment based on a protected characteristic is incorrect.