Connect with us

Hi, what are you looking for?

The American Genius Real EstateThe American Genius Real Estate

Professionalism

How one lender discriminated against applicants with disabilities

HUD has settled with a lender for their discriminating against borrowers with disabilities, violating the Fair Housing Act.

hud

The U.S. Department of Housing and Urban Development (HUD) announced that Freedom Mortgage Corporation, a national residential mortgage lender based in Mt. Laurel, New Jersey, will pay $104,000 to settle allegations that it discriminated against loan applicants with disabilities by requiring them to provide medical or other documentation regarding their disability.

HUD officials alleged the company’s actions violated the Fair Housing Act, which outlaws discrimination in the sale, rental, and financing of dwellings or other housing-related transactions based on disability and other factors.

The allegations filed in a HUD Secretary Initiated Complaint filed in 2013, stated that Freedom Mortgage’s underwriting policies and practices subjected persons with disabilities to different terms and conditions from other applicants by requiring, among other things, that they provide doctor’s notes or letters from the Social Security Administration that their disability income would continue for three years. Freedom and HUD identified 69 applicants with disabilities subjected to such terms and conditions.

Treating everyone equally

Gustavo Velasquez, HUD’s Assistant Secretary for Fair Housing and Equal Opportunity stated, “applicants who are otherwise qualified for a home loan may not have additional requirements placed on them because of a disability. We’re pleased that this national mortgage lender, through this agreement, is making a commitment to comply with its obligation to treat persons with disabilities the same way they treat those who are not disabled.”

In one particular case, a loan applicant provided medical documentation of his disability, a Department of Labor Work Capacity Evaluation form, and a benefits statement detailing regular disability payments since 2009, and still Freedom Mortgage allegedly continued to request proof that the income would continue for at least three years.

The terms of the agreement, establish a three-tiered restitution system from Freedom, whereby the 69 aggrieved applicants will receive damages. They will each receive, $1,000, $2,000, or $5,000 in damages. Additionally, Freedom will amend its underwriting guidelines to abolish disability-related income verification requirements for applicants who receive disability income, and require employees to attend training on the Fair Housing Act.

Jennifer Walpole is a Senior Staff Writer at The American Genius and holds a Master's degree in English from the University of Oklahoma. She is a science fiction fanatic and enjoys writing way more than she should. She dreams of being a screenwriter and seeing her work on the big screen in Hollywood one day.

Advertisement

The Daily Intel
in your inbox

Subscribe and get news and EXCLUSIVE content to your email inbox.

Advertisement

KEEP READING!

Professionalism

Meeting weekly is rarely something a team looks forward to, but there are ways for brokers to improve attendance easily.

Op/Ed

(EDITORIAL) Surely after a century, we have learned half the population can work just the same as the other half right? Down with discrimination.

Fair Housing

Did you know that Fair Housing was inspired by a vet who volunteered his life to defend our nation, only to come home and...

Real Estate Associations

(REAL ESTATE ASSOCIATIONS) NAR’s new interactive training simulation confronts housing discrimination by putting agents in the shoes of homebuyers.

The American Genius' real estate section is honest, up to the minute real estate industry news crafted for industry practitioners - we cut through the pay-to-play news fluff to bring you what's happening behind closed doors, what's meaningful to your practice, and what to expect in the future. We're your competitive advantage. The American Genius, LLC Copyright © 2005-2022