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Governor Mike Braun
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Fair Treatment in Credit Applications

Fair Treatment in Credit Applications

Individuals have the right to apply for credit without being treated unfairly because of protected classes. Lenders and creditors must evaluate credit applications using consistent standards and may not discriminate against applicants based on protected characteristics.

Under federal and Indiana civil rights laws, discrimination in the credit application process may violate the law when applicants are discouraged from applying, given different information, or treated differently because of a protected class.

These protections help ensure that everyone has equal access to credit opportunities.

What is the Credit Application Process?

The credit application process involves requesting financial services from a lender or creditor.

Examples of credit applications may include applying for:

  • Mortgage loans
  • Car loans
  • Credit cards
  • Personal loans
  • Student loans
  • Retail financing programs

During this process, lenders review financial information such as income, credit history, and ability to repay the loan.

Protected Classes in Credit:

Discrimination in credit may occur when applicants are treated differently because of a protected class.

Protected classes in credit may include:

  • Race
  • Color
  • Religion
  • Sex
  • Disability
  • National origin
  • Ancestry

Creditors should ensure that their policies and practices do not treat applicants differently based on these characteristics.

Equal Treatment in Credit Applications:

Creditors must apply the same standards to all applicants when evaluating credit applications.

Applicants should receive the same information about credit products and should be evaluated based on financial qualifications rather than protected characteristics.

Equal treatment helps ensure that individuals are given fair opportunities to obtain credit.

Examples of Discrimination During Credit Applications:

Discrimination may occur during the application process in several ways. Examples may include:

  • Discouraging someone from applying for credit because of a protected class
  • Providing different information about loan products to different applicants
  • Requiring additional documentation from certain applicants without a legitimate reason
  • Steering applicants toward certain loan products based on protected characteristics
  • Refusing to accept applications from individuals in certain communities

Applicants should be evaluated based on financial qualifications and creditworthiness.

Fair Communication with Applicants:

Creditors should communicate clearly and consistently with applicants during the credit process.

This may include:

  • Providing accurate information about loan options
  • Explaining application requirements
  • Communicating credit decisions in a timely manner

Clear communication helps ensure that applicants understand their options and can make informed financial decisions.

If You Believe You Experienced Credit Discrimination

If you believe you were treated unfairly during the credit application process because of a protected class, you may be able to file a discrimination complaint.

The Indiana Civil Rights Commission investigates complaints involving discrimination in credit, housing, employment, education, and public accommodations.

To learn more about filing a complaint, visit the How to File a Discrimination Complaint page.