Auto Dealerships are subject to a federal law called the Equal Credit Opportunity Act ("ECOA") because they help consumers obtain financing to buy cars. This law makes it illegal to discriminate against people who apply for credit.
The law requires that all customers have an equal chance to obtain credit. This does not mean that every customer who applies for credit will receive it, but it does mean that all customers must be treated equally in their pursuit of credit. In general, this means the company cannot discriminate against a customer in a credit transaction based on his or her:
- national origin
- marital status
- religion
- sex
- color
- race
- age (provided the applicant has the capacity to contract)
- receipt of public assistance benefits.
Penalties for violating the Equal Credit Opportunity Act can be severe and include substantial fines and punitive damages.
Implementation Steps in this Guide
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Edit and Distribute the Equal Credit Opportunity Act/Regulation B Policy
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Distribute The Equal Credit Opportunity Act and Regulation B Interactive Policy
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Distribute The Equal Credit Opportunity Act and Regulation B Assessment
Edit and Distribute the Equal Credit Opportunity Act/Regulation B Policy
Edit the policy
- Click on the Library tab
- Search for "Equal Credit Opportunity Act/Regulation B Policy" and click on it
- Click on the Edit button to view the list of versions
- Click Create Draft to the right of the latest published version
- Click Edit next to the Draft version that you just created
- Make desired changes to the policy
- Click Publish when you have finished editing the policy
- Click on the Permissions subtab
- Add the appropriate group(s) of users who have permission to view this policy within the library
- Click Submit to save
Schedule the activity for distribution
- Click on the Workspaces tab
- Click on the Consumer Finance workspace
- Click on the Equal Credit Opportunity Act/Regulation B initiative
- Click on the Equal Credit Opportunity Act/Regulation B Policy
- Click on Groups and assign to the appropriate groups, such as management, controller, sales, finance and insurance, and anyone who participates in a credit transaction.
- Click on Schedule and set an annual schedule based on the Hire Date. We recommend that you set the Immediate Distribution option to Yes.
- Click Save
Distribute The Equal Credit Opportunity Act and Regulation B Interactive Policy
- Click on the Workspaces tab
- Click on the Consumer Finance workspace
- Click on the Equal Credit Opportunity Act/Regulation B initiative
- Click on the The Equal Credit Opportunity Act and Regulation B Interactive Policy
- Click on Groups and assign to the appropriate groups, such as management, controller, sales, finance and insurance, and anyone who participates in a credit transaction.
- Click on Schedule and set an annual schedule based on the Hire Date. We recommend that you set the Immediate Distribution option to Yes.
- Click Save
Distribute The Equal Credit Opportunity Act and Regulation B Assessment
- Click on the Workspaces tab
- Click on the Consumer Finance workspace
- Click on the Equal Credit Opportunity Act/Regulation B initiative
- Click on the The Equal Credit Opportunity Act and Regulation B Assessment
- Click on Groups and assign to the appropriate groups, such as management, controller, sales, finance and insurance, and anyone who participates in a credit transaction.
- Click on Schedule and set an annual schedule based on the Hire Date. We recommend that you set the Immediate Distribution option to Yes.
- Click Save
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