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Bank of America Charged with Discriminating Against Homebuyers with Disabilities
The U.S. Department of Housing and Urban Development (HUD) charged Bank of America (BofA) this Thursday with discriminating against loan seekers with disabilities.
HUD's mission is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD along with President Barack Obama's Financial Fraud Enforcement Task Force (FFETF), works to address consumer fraud, which can financially cripple households and can cause extensive losses to our economy. The two groups partnered to bring the charges based off of complaints from individuals in two different states. The allegations say that after initially denying the loans, BofA "imposed unnecessary and burdensome requirements" by asking some borrowers to provide additional and unnecessary information including proof of their disabilities from their physicians and proof that their Social Security income will last before approving loans.The Fair Housing Act makes it illegal to discriminate in a loan to an individual based on a disability. This includes imposing different application or qualification criteria, and it makes it illegal to inquire about the nature or severity of a disability except in limited circumstances which are not applicable in any of these cases. John Trasviña, HUD Assistant Secretary for Fair Housing and Equal Opportunity said of the allegations “Holding homebuyers with disabilities to a higher standard just because they rely on disability payments as a source of income is against the law,...Mortgage companies may verify income and have eligibility standards but they may not single out homebuyers with disabilities to delay or deny financing when they are otherwise eligible.”
Bank of America claims there is no validity to the allegations and that the variation in practice is based off of the differences in loan standards or requirements and underwriting procedures between FHA and conventional loans.
The matter is now in the hands of the Department of Justice.
FHEO and its partners in the Fair Housing Assistance Program investigate approximately 10,000 housing discrimination complaints annually. People who believe they are the victims of housing discrimination should contact HUD at 1-800-669-9777 (voice), (800) 927-9275 (TTY) or visit www.hud.gov .