What is the main objective of the Equal Credit Opportunity Act (ECOA)?

The main objective of the Equal Credit Opportunity Act (ECOA) is to prevent discrimination in credit transactions. This federal law was enacted to ensure that all individuals have fair access to credit regardless of race, color, religion, national origin, sex, marital status, age, or because they receive public assistance. The ECOA promotes equal treatment of borrowers, making it illegal for creditors to discriminate against applicants on any of these bases. This commitment to fairness helps establish a more equitable lending environment, ensuring that consumers can obtain credit based on their creditworthiness rather than personal characteristics that are unrelated to their ability to repay a loan.

The focus of the ECOA is not on regulating interest rates, monitoring loan servicing practices, or setting credit score guidelines, which are the themes of the other options provided. Instead, it centers fundamentally on combating discrimination and fostering equal access to credit, highlighting its critical role in consumer protection and fairness within the lending process.