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With rulings on Affordable Care and gay marriage attracting most of the attention, a ruling on Fair Lending almost got lost in the shuffle. On June 25 the Supreme Court of the United States (SCOTUS) rendered a decision in the case of Texas Department of Housing and Community Affairs et al. vs. Inclusive Communities Project, Inc. The case involved the disparate impact theory of discrimination under the Fair Housing Act. The issue to be decided was whether […]

The previous parts of this article have documented the issue of maternity leave discrimination and the typical regulatory response to the problem. Now we focus on steps to avoid the problem. Underwriting guidelines should provide detailed instructions on the consideration and calculation of temporary leave income. Most investors have such guidelines in place. A typical set of guidelines for temporary leave income are contained in the Fannie Mae Selling Guide (Published December 14, 2014). The […]

In the first part of this article we explored the issue of maternity leave discrimination. This time we consider the typical cure imposed by regulators. Creditors have paid millions of dollars in damages; typically in the range of $20,000 to $30,000 per incident. In additional to paying damages, creditors are often required to implement revised policies and procedures and to conduct training. Policies It is common for a settlement agreement to require creditors, within thirty […]

Most of our readers probably have heard of the case involving a couple, who had just had twins, whose world was turned upside down when their loan was denied after the creditor learned that the wife was on maternity leave. The application had been approved and the closing was scheduled.  After the denial the wife and infant twins had to move in with her parents. The husband moved to an apartment with their 3-year-old. The creditor […]

On October 2, 2014 the Department of Housing and Urban Development (HUD) announced that it has negotiated a Conciliation Agreement with Midland States Bancorp, resolving allegations that the bank avoided doing business in predominantly African American and Hispanic neighborhoods in St. Louis, Missouri and northern Illinois in violation of the Fair Housing Act. Midland is a community bank based in southern Illinois. The settlement is the result of a housing discrimination complaint filed by Metropolitan St. […]