Which regulation requires lenders to notify applicants if their loan application is denied?

The Equal Credit Opportunity Act (ECOA) requires lenders to notify applicants of the reasons for the denial of their loan applications. This regulation was established to promote equal access to credit and to ensure that applicants are treated fairly, regardless of their race, color, religion, national origin, sex, marital status, or age. Under ECOA, if an application is denied, lenders must provide a written notice that includes the reason for the denial or disclose the applicant's right to request such information.

The Fair Housing Act primarily focuses on discrimination in housing-related transactions, rather than loan application processes specifically. The Truth in Lending Act is concerned more with the disclosure of credit terms and costs associated with borrowing, ensuring transparency for borrowers. The Dodd-Frank Act includes comprehensive reforms in the financial services industry, but it is not specifically focused on notification requirements for loan denials. Thus, the ECOA is the regulation that directly addresses the need for lenders to inform applicants regarding the denial of their applications.