Recently the U.S. Department of Housing and Urban Development (HUD) announced an agreement with Bank of America (BOA) to settle a claim that the mortgage lender refused to provide financing to a lesbian couple. The agreement is the first enforcement action taken against a lender involving HUD’s recent rule ensuring that the Department’s core housing programs be open to all eligible persons, regardless of sexual orientation, gender identity, or marital status. HUD’s rule, Equal Access to Housing […]
Tag: Fair Lending
HOW UNEARNED DISCOUNT POINTS MAY RESULT IN FAIR LENDING VIOLATIONS
This is the third part of a five part series that explores issues related to discount points. The previous article explored UDAAP concerns resulting from unearned discount points. This article considers how unearned discount points may result in fair lending violations. Almost any lending practice may result in an disparate impact violation under the Equal Credit Opportunity Act (ECOA), as implemented by Regulation B, and the Fair Housing Act (FHA). Charging unearned discount points is […]
ANOTHER DOJ DISCRIMINATION SETTLEMENT
On July 12, 2012, Wells Fargo, the nation’s largest mortgage lender, agreed to settle with the Justice Department to resolve allegations that it steered black and Hispanic borrowers into subprime loans when similarly qualified white borrowers received mortgages with lower rates. The settlement requires Wells Fargo to provide $125 million to borrowers, $50 million in down-payment assistance in hard-hit regions where Justice found evidence of discrimination, and additional compensation to blacks and Hispanics who were […]
HUD DELIVERS TRIPLETS
During 2011 HUD settle cases with two lenders involving familial status discrimination. In both cases women on paid maternity leave were told to wait until they returned to their full-time positions credit could be approved. The first case, in August 2011, cost the lender more than $750,000. The first victim received $15,000, later victims were to $7,500 each. In the November case the victim received $12,000. The lender was required tocreate a fund to compensate […]
ANOTHER DOJ FAIR LENDING CASE
On May 31st the Department of Justice settled a fair lending case with Sun Trust Mortgage. The case was completely typical. The case: > Began with a referral from the bank’s regulator – the Federal Reserve Board. > Involved discrimination against black and Hispanic borrowers. > Involved pricing discrimination resulting from unguided lender discretion. DOJ continues to very active in this area. During the past few years DOJ has averaged about seven cases per year. […]