An Overview of Federal Fair Housing, Credit, and Lending Law Regulations from A to Z

Are your clients asking what all the alphabetical Federal fair housing, credit, and lending regulations really mean?

Hint: They have to do with protecting consumers when it comes to fair business and fair treatment when applying for a mortgage.

Of the numerous regulations, which extend virtually from A to Z — some were established by lawmakers dating back all the way to the 1900s. And some were more recently established by the Secure and Fair Enforcement for Mortgage Licensing (SAFE) Act in 2008 as well as the Consumer Financial Protection Bureau (CFPB) when it was founded in 2011.

These regulations ensure three basic things.

Consumer finances are protected when purchasing a home.
Consumers receive fair treatment and fair service when exploring and applying for housing, credit, and lending programs available to them.
Banks, lenders, creditors, realtors, landlords, and other players consumers meet in the process of investing in real estate act fairly, legally, and in their best interest.

When applying for a mortgage, it often seems like the endless documents and forms your clients must sign and initial are nothing but tree killers.

However, I’m here to tell you that ALL of these forms serve an important purpose. They were created to protect your client.

This month, we’re continuing Mindful Money’s mission of Providing Financial Growth, Through Mindful Lending by shedding light on these important regulations to help you become a more educated Realtor (and consumer) when purchasing a home.

With the near literal alphabet of regulations in place, we’re going to start at the beginning with Regulation B.

Read on for brief summaries of the regs, links for more info, and the chance to increase your understanding and better inform your clients.

Glossary of Fair Housing, Credit, and Lending Regulations

Regulation B : Equal Credit Opportunity Act – Prohibits creditor practices that discriminate on the basis of race, color, religion, national origin, sex, marital status, and age.
Regulation C : Home Mortgage Disclosure Act – Requires financial institutions to maintain, report, and publicly disclose loan-level information about mortgages. This data helps show whether lenders are serving the housing needs of their communities and sheds light on lending patterns that could be discriminatory.
Regulation D : Alternative Mortgage Transaction Parity - Authorizes state-chartered housing creditors to make, purchase, and enforce alternative mortgage transactions without regard to any state constitution, law, or regulation
Regulation E : Electronic Fund Transfers – Establishes the basic rights, liabilities, and responsibilities of consumers who use electronic fund transfer and remittance transfer services and of financial institutions or other persons that offer these services. Protects you, the consumer, when you engage in electronic fund transfers.
Regulation F : Fair Debt Collection Practices Act – Limits the behavior and actions of third-party debt collectors who are attempting to collect debts on behalf of another person or entity. Restricts the means and methods by which collectors can contact debtors, as well as the time of day and number of times contact can be made.
Regulation G : S.A.F.E. Mortgage Licensing Act – Federal Registration of Residential Mortgage Loan Originators- Created to establish minimum standards for licensing and regulation of mortgage loan originators to enhance consumer protection and reduce fraud.
Regulation H : S.A.F.E. Mortgage Licensing Act – State Compliance and Bureau Registration System - Enhances consumer protection and reduces fraud by directing states to adopt minimum uniform standards for the licensing and registration of residential mortgage loan originators and to participate in a nationwide mortgage licensing system and registry database of residential mortgage loan originators.
Regulation I : Disclosure Requirements for Depository Institutions Lacking Federal Deposit Insurance - Requires the disclosure of certain insurance-related information in periodic statements, account records, locations where deposits are normally received, and advertising. Also requires such depository institutions to obtain a written acknowledgment from depositors regarding the institution's lack of Federal deposit insurance.
Regulation J : Land Registration - Implements registration, disclosure, and anti-fraud requirements under the Interstate Land Sales Full Disclosure Act for the sale or lease of non-exempt lots in a subdivision.
Regulation K : Purchasers’ Revocation Rights, Sales Practices and Standards – Defines certain unlawful sales practices and provides standards to illustrate what other sales practices are considered misleading within the context of property sale and leases. Also allows a purchaser to revoke a contract during an established revocation period.
Regulation L : Special Rules of Practice - Governs procedures under which land developers may obtain pre-filing assistance and be notified of and permitted to correct deficiencies in the Statement of Record
Regulation M : Consumer Leasing – Ensures meaningful and accurate disclosure of lease terms is provided to consumers before entering into a lease contract.
Regulation N : Mortgage Acts and Practices-Advertising – Regulates how mortgage lenders, servicers, brokers, advertising agencies, and others can advertise their mortgage services. Forbids deceptive claims in mortgage advertising and other commercial communications sent to consumers by mortgage brokers, lenders, services, and advertising agencies
Regulation O : Mortgage Assistance Relief Services - Makes it illegal to charge upfront fees and requires specific disclosures in ads and when you forward a lender’s offer to a homeowner in a foreclosure situation.
Regulation P : Privacy of Consumer Financial Information – Protects against the misuse of private, non-public information by financial institutions and banks consumers conduct business with.
Regulation V : Fair Credit Reporting – Protects the confidential information of consumers and ensures privacy and accuracy of information contained in consumer credit reports.
Regulation X : Real Estate Settlement Procedures Act – Mandates that lenders, mortgage brokers, and servicers provide consumers with complete cost settlement disclosures in real estate transactions.
Regulation Z : Truth in Lending – Ensures consumers receive clearer information about the true costs of credit and protects them from certain misleading practices in the industry. Lenders must disclose interest rates, define cancellation periods, and use clear loan/credit terms when offering and advertising a loan product.
Regulation DD : Truth in Savings – Helps consumers make more informed decisions about the accounts they open at financial institutions. Mandates that lenders provide uniform information about fees and interest rates when opening up an account for a customer.

Additional Sources

There are tons of great resources that help you further understand each of the above regulations and how they may relate to you now or in the future. Here are some of my favorites:

Have a Question on Fair Housing, Credit, or Lending Regulations or Want to Chat About Mortgages?

I’m always here to help educate you and help you feel more empowered as you move throughout the process of purchasing a home and weighing your mortgage options and helping your clients do the same. So whether you’d like to chat about loan programs, get a pre-approval, or better understand how a lending regulation affects you, give me a call! Reach me at 480-313-7103 or sam@mindfulmoneyusa.com.

* Specific loan program availability and requirements may vary. Please get in touch with your mortgage advisor for more information.