Alert May 14, 2013

HUD Settles Violations of Fair Housing Act

HUD announced that it has settled claims alleging a bank violated the Fair Housing Act by requiring a home loan applicant to return to work and obtain a letter from her employer detailing her leave of absence before the bank would approve the application. The terms of the settlement require the bank to pay $18,000 to the applicant, provide fair lending training to its loan officers and underwriters and adopt parental leave guidelines. The bank also agreed to take additional actions as it determines may be needed to promote fair lending and ensure compliance with the Fair Housing Act. This is the second such HUD settlement involving pregnancy discrimination (see February 19, 2013 Alert) and highlights the renewed focus of federal regulators on fair lending discrimination (see March 5, 2013 Alert discussing CFPB’s focus on fair lending issues).