On January 23, 2013 the Department of Housing and Urban Development (HUD) announced the settlement of a case that alleged that the bank required a loan applicant with disabilities to provide unnecessary documentation to establish he would continue receiving disability income for three years before they would approve his mortgage loan. The applicant submitted documentation from the Social Security Administration as part of his mortgage application. Additional documentation was not needed because Social Security award letters without expiration dates establish continuity of income for three years.
Under the terms of its agreement with HUD, the lender agreed to pay the man $12,000, accept SSI award letters as establishing at least three years’ income, and refrain from requiring applicants receiving disability income to provide doctors’ statements concerning the nature, severity, or duration of a disability.