Legal Alert - Recent ECOA Case Reinforces the Importance of Lender Underwriting Procedures for Spousal Guaranties


by Michael Strand and Christopher J. Lane

A recent federal district court decision reinforces the importance of carefully maintaining a program of underwriting policies and procedures that comply with the Equal Credit Opportunity Act (ECOA). In PNC Bank, N.A. v. Miller, No: 6:13-cv-208, 2013 WL 2455972 (M.D. Fla. 06/06/13), the United States District Court for the Middle District of Florida held that a violation of the ECOA could be asserted as an affirmative defense against the enforcement of a guaranty. PNC Bank sued Sanford Miller for his default on two commercial loans and also sued Mary Kelly Miller, his wife, for her failure to repay the loans pursuant to a personal guaranty that she had executed in favor of PNC Bank. Ms. Miller asserted that PNC Bank, by requiring her to execute a personal guaranty as part of her husband’s business loans, violated the ECOA.

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