(a) Standards for programs. Subject to the provisions of paragraph
(b) of this section, the act and this regulation permit a creditor
to extend special-purpose credit to applicants who meet eligibility
requirements under the following types of credit programs:
(1) any credit assistance program expressly
authorized by federal or state law for the benefit of an economically
disadvantaged class of persons;
(2) any credit assistance program offered
by a not-for-profit organization, as defined under section 501(c)
of the Internal Revenue Code of 1954, as amended, for the benefit
of its members or for the benefit of an economically disadvantaged
class of persons; or
(3) any special-purpose credit program offered by a for-profit organization,
or in which such an organization participates to meet special social
needs, if—
(i) the program is established and administered
pursuant to a written plan that identifies the class of persons that
the program is designed to benefit and sets forth the procedures and
standards for extending credit pursuant to the program; and
(ii) the program is established
and administered to extend credit to a class of persons who, under
the organization’s customary standards of creditworthiness, probably
would not receive such credit or would receive it on less favorable
terms than are ordinarily available to other applicants applying to
the organization for a similar type and amount of credit.
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(b) Rules in other sections.
(1) General applicability. All of the provisions of this regulation
apply to each of the special-purpose credit programs described in
paragraph (a) of this section except as modified by this section.
(2) Common characteristics. A program described
in paragraph (a)(2) or (a)(3) of this section qualifies as a special-purpose
credit program only if it was established and is administered so as
not to discriminate against an applicant on any prohibited basis;
however, all program participants may be required to share one or
more common characteristics (for example, race, national origin, or
sex) so long as the program was not established and is not administered
with the purpose of evading the requirements of the act or this regulation.
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(c) Special rule concerning
requests and use of information. If participants in a special-purpose
credit program described in paragraph (a) of this section are required
to possess one or more common characteristics (for example, race,
national origin, or sex) and if the program otherwise satisfies the
requirements of paragraph (a) of this section, a creditor may request
and consider information regarding the common characteristic(s) in determining
the applicant’s eligibility for the program.
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(d) Special rule in the case of financial
need. If financial need is one of the criteria under a special-purpose
program described in paragraph (a) of this section, the creditor may
request and consider, in determining an applicant’s eligibility for
the program, information regarding the applicant’s marital status;
alimony, child support, and separate maintenance income; and the spouse’s
financial resources. In addition, a creditor may obtain the signature
of an applicant’s spouse or other person on an application or credit
instrument relating to a special-purpose program if the signature
is required by federal or state law.
