October 10, 2014
The FHA and HUD have taken a special interest in ending home loan discrimination against those who are pregnant or on maternity leave. Since 2010 HUD has received nearly 200 maternity leave discrimination complaints; the Fair Housing Act makes it a crime to “discriminate in real estate related transactions, including the provision of home mortgage loans, on the bases of race, color, national origin, religion, sex, disability, or familial status” according to the FHA official site.
A recent HUD press release announces a major settlement between the Department of Housing and Urban Development and Wells Fargo Home Mortgage.
According to HUDNo.14-124, HUD “has reached a $5 million settlement with Wells Fargo Home Mortgage, the nation’s largest provider of home mortgage loans, resolving allegations that the lender discriminated against women who were pregnant, or had recently given birth, and were on maternity leave.” Six families from a variety of states filed complaints against Wells Fargo, which resulted in the HUD investigation and eventual settlement.
“The settlement is significant for the six families who had the courage to file complaints, and for countless other families who will no longer fear losing out on a home simply because they are expecting a baby,” said HUD Secretary Julián Castro. “I’m committed to leveling the playing field for all families when it comes to mortgage lending. These types of settlements get us closer to ensuring that no qualified family will be singled out for discrimination.”
What were the results of the agreement between HUD and Wells Fargo Home Mortgage? “…the lender will distribute a total of $165,000 among six affected families; create a fund with at least $3.5 million to compensate other Wells Fargo applicants who experienced discrimination because they were pregnant or on maternity leave when they applied for a loan; and pay as many as 175 claimants $20,000 each.”
The HUD press release adds that Wells Fargo has pledged new underwriting guidelines aimed at preventing future maternity leave or parental leave discrimination.
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Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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