Friday, June 14, 2013

HUD, Bankster Settle Fair Housing Allegations That Lender Discriminated Against Two Pregnant Women On Maternity Leave In Unrelated Cases Involving Home Financing Transactions; Victims Each Pocket $18K; Feds: Bias Prohibitions Also Apply When Men Take Paternity Leave

From the Department of Housing & Urban Development (Washington, D.C.):
  • The U.S. Department of Housing and Urban Development (HUD) announced [] that it has reached two Conciliation Agreements with SunTrust Mortgage, Inc., settling allegations that the Richmond, VA-based lender denied mortgage loans to a couple in Port St. Lucie, FL, and another couple in Ashland, VA, because the women were on maternity leave.

    The Fair Housing Act makes it unlawful to discriminate in residential real estate-related transactions based on race, color, national origin, religion, sex, disability, or familial status. These prohibitions include denying a mortgage because a person is pregnant or takes maternity or paternity leave.
  • A Port St. Lucie, FL, woman and her husband alleged that SunTrust had pre-approved them for a mortgage loan, but 14 days before closing, a loan officer informed them that the loan would not be approved unless she returned to work.

    In the Ashland, VA, case, a couple alleged that the bank had provided a construction-to-permanent mortgage loan but delayed its conversion to a permanent loan until after the woman returned from maternity leave. The Fair Housing Act requires lenders to provide full and fair access to home mortgages regardless of a person’s sex or familial status, including pregnancy.

    Under the terms of the agreements, SunTrust will pay each couple $18,000, adopt a parental leave policy that prohibits discriminatory mortgage lending due to parental leave, and train their employees on the fair lending requirements of the Fair Housing Act. The Parental Leave Policy specifically prohibits asking mortgage applicants about their intent to take parental leave in the future. The policy also provides that mortgage applicants on or scheduled to be on parental leave may still qualify for loan approval and funding.
For the HUD press release, see HUD And Suntrust Bank Settle Maternity Leave Discrimination Claims (Bank to pay two couples who were denied loans).