Ford Credit is paying $650,000 to settle government allegations that it discriminated against unmarried couples in the processing of loan applications.

The firm, the finance arm of Ford Motor Co., failed to combine the incomes of unmarried joint loan applicants, while joining the incomes of applicants who were married, according to the lawsuit, filed by the Federal Trade Commission.

The practice, used by Ford Credit between May 1994 and August 1995, meant that unmarried applicants received "less favorable terms" than their married peers, the government's complaint said.

Those "less favorable terms," including higher interest rates, amounted to violations of the Equal Credit Opportunity Act, the FTC said.

Ford Credit admitted no wrongdoing in agreeing to the settlement. Any inequities in how the company handled loans stemmed from the credit act, whose regulations were unclear, said Ford spokesman Walter Jennings.

The practice of treating unmarried and married joint loan applicants differently ended in 1995, when the Federal Reserve Board issued clarifications of the credit act, Jennings said.

"We regret any inconvenience unmarried couples might have suffered" under the separate credit rating systems, Jennings said.

The $650,000 is one of the largest settlements obtained by the FTC in a complaint alleging violations of the Equal Credit Opportunity Act, according to FTC officials. In May of this year, the agency collected an $800,000 civil penalty from Franklin Acceptance Corp., a Philadelphia finance company accused of relationship discrimination.

Proceeds from the Ford settlement will be distributed to those loan applicants "who were adversely affected" by the dual rating system while it was in force, the FTC said.

In addition, according to the FTC and company spokesman Jennings, the company has agreed not to discriminate against applicants on the basis of marital status.

Neither the company nor the FTC could give the exact number of loan applicants affected by the settlement agreement.

Consumers who think they might be covered are advised to contact the FTC's Consumer Response Center, Room 130, 600 Pennsylvania Ave. NW, Washington, D.C. 20580, or call 1-877-382-4357. Information also is available on the Internet at www.ftc.gov.