The U.S. Department of Housing and Urban Development (HUD) has announced that it has reached an Agreement with PNC Mortgage in Trumbull, CT, settling allegations that the lender violated the Fair Housing Act by requiring a home loan applicant on paid maternity leave to return to work before the lender would approve a home loan. PNC Mortgage is a division of Virginia-based PNC Bank National Association.
The Fair Housing Act prohibits discrimination in the sale, rental, and financing of dwellings, and in other housing-related transactions, based on race, color, national origin, religion, sex, familial status, and disability. Refusing to approve a mortgage loan or provide refinancing because a woman is pregnant or on maternity leave violates the Fair Housing Act’s prohibitions against sex and familial status discrimination.
"Since 2010, HUD has been investigating lenders who have allegedly violated the Fair Housing Act by requiring women to terminate their maternity leave early in order to qualify for a home loan,” stated John Trasviña, HUD Assistant Secretary for Fair Housing & Equal Opportunity. “HUD will continue to enforce the law and take action against lenders whose loan policies establish different terms and conditions for women who are pregnant or on maternity leave.”
HUD’s complaint alleged that because PNC required the woman, a Navy veteran, to return to work before approving the Department of Veterans Affairs (VA)- guaranteed loan, the couple could not close on their new home in Newington, CT, until a month later than they had planned. As a result, the seller of the home allegedly required the couple to pay an additional $3,000 for the delay.
Under the Agreement, PNC will pay $15,000 to the couple and review applications for VA-guaranteed residential mortgage loans filed in the last two years in Maine, Vermont, Connecticut, New Hampshire, Massachusetts, Rhode Island, Pennsylvania, and New York to identify qualified loan seekers whose applications were denied because they were pregnant or on maternity leave. PNC will pay $7,500 each victim who is identified. PNC will also revise its Temporary Leave/Short-Term Disability Income policy if HUD finds that the policy is deficient, and will provide fair lending training to its residential mortgage loan originators, underwriters, and processors.