The U.S. Department of Housing and Urban Development (HUD) announced Greenlight Financial Services, a mortgage lender based in Irvine, CA, will pay $48,000 to settle allegations that it violated the Fair Housing Act when it denied or delayed mortgage loans to women who were on maternity leave.
The Fair Housing Act includes a stipulation making it unlawful to discriminate against a woman who is pregnant or on family leave; apparently Greenlight Financial Services thought they could overlook this information and they will pay a fairly hefty fine for ignoring it. The Conciliation Agreement reached resolves a married couples’ complaint they filed with HUD alleging Greenlight Financial Service, now known as GFS Capital Holdings, denied their application to refinance their home mortgage because the wife was on maternity leave. As HUD began their investigation, they also found Greenlight Financial Services allegedly denied, or delayed four other applicants’, all on maternity leave, applications until after the women had returned to work.
Greenlight will have to pay up
“The fact that an applicant is on maternity leave alone is not a valid basis for denying or delaying a refinance loan,” said Bryan Greene, HUD’s General Deputy Assistant Secretary for Fair Housing and Equal Opportunity. “HUD will continue to enforce fair housing laws to ensure that no otherwise qualified applicant is illegally denied the home financing they need only because they take maternity, paternity or parental leave.”
Under the terms of the Conciliation Agreement, Greenlight Financial Services will pay $20,000 to the couple that initially filed the complaint, and $7,000 to each of the other four applicants HUD identified during its investigation. In an effort to save face, the company has also decided to hold annual fair lending training to employees and management staff, if they decide to resume their mortgage operations (as their mortgage services have since been terminated).