SAFE MLO ECOA, Fair Housing & HMDA question: applicant's income includes Social Security disability benefits

SAFE MLOECOA, Fair Housing & HMDA

An applicant's income includes Social Security disability benefits that are expected to continue. The MLO wants to leave that income out because it is 'government money.' What does Regulation B require?

A Treat it the same as other income when judging creditworthiness
B Count only half of it to allow for program changes
C Exclude it, because public assistance is not stable income
D Count it only if the applicant also has a job

Show the answer and explanation

Answer: A. Treat it the same as other income when judging creditworthiness

Receipt of income from a public assistance program is a prohibited basis, and a creditor may not discount or exclude income because it comes from public assistance (12 CFR 1002.2(z); 12 CFR 1002.6(b)(5)). The creditor may consider how likely the income is to continue, but may not exclude it because of its source. Source: 12 CFR 1002.2(z); 12 CFR 1002.6(b)(5) (as at 11 Oct 2026).

Common mistake

Discounting benefit income because of where it comes from.

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Original study material mapped to the public NMLS Content Outline; not a real test question.Not affiliated with or endorsed by NMLS, CSBS or SRR. Verify figures and rules against current guidance before relying on them.