BOA Settles Gender Discrimination Suit

Bank of America (BOA) has settled
accusations by the Department of Housing and Urban Development (HUD) that one
of its California branches had discriminated against a woman on maternity
.  This is the second settlement of
such a suit against a mortgage related entity in a month.

According to a statement released by
HUD, BOA has agreed to pay $161,180 to settle allegations that, after offering
her a loan and receiving all of the necessary documentation, it refused to
finance the mortgage loan of an Irvine California woman even though she was
receiving full pay and benefits while on maternity leave.  When the bank did approve her loan two months
later it was at a rate 25 basis points higher than originally promised. Discriminating
against a woman who is pregnant or on maternity leave is a violation of the
Fair Housing Act’s prohibition against sex and family status discrimination.

In May Mortgage Guaranty Insurance
Corporation (MGIC), the nation’s largest provider of private mortgage
insurance, settled a similar complaint with HUD over its  policy that required women on maternity leave
to return to work before the company would insure their mortgages even when
those women had a guaranteed right to return to work.  MGIC agreed to pay a $38,750 civil penalty
and to establish a $511,250 fund to compensate 70 individuals who had been
refused coverage.  

Fair Housing Act prohibits lenders from denying home loans to women because
they are pregnant or on maternity leave,” said John Trasviña, HUD Assistant
Secretary for Fair Housing and Equal Opportunity. “Today’s settlement follows
HUD actions involving other lenders across the country which we will continue
until maternity leave discrimination is eliminated.”

A Bank of America official said: “We
regret our treatment of the applicant. We take our Fair Lending
responsibilities very seriously and will work with HUD to ensure our customers
on maternity leave are treated appropriately during the mortgage application

…(read more)

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