Question

A 16-year-old female applied for a conventional loan in order to purchase a condominium. The lender denied the application, citing the applicant's age as the reason for the denial. Which of these is TRUE?
a. The lender violated the ECOA because the applicant is female and sex cannot be a lending consideration.
b. The lender violated the ECOA because lending decisions cannot be based on age.
c. The lender lawfully denied the application because the applicant was under 18 and therefore was too young to legally sign a contract.
d. None of these.

Answer 1

Answer:

C.

Explanation:

The lender lawfully denied the application because the applicant was under 18 and therefore was too young to legally sign a contract.

A 16 year old is not up to the age to sign a contract and even at that Every lender has their own requirements for approving a loan. And for a person who is just 16 getting a loan approval is going to be near impossible except it is done with the cosignature of a parent. This is because several checks are usually done before a loan is approved and a 16 year old may not pass all of them.