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HUD Settlement means More Commissions in Your Bank Account

June 17, 2012
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Despite the fact the banks hope to hush up bad news OC Register writers Jonathan Lasner and Jeff Collins brought significant local news to our industry.

In a move that will mean more commissions for all of our industry, HUD has begun actively enforcing The Fair Housing Act which prohibits lenders from denying home loans to expectant women on maternity leave.

We’ve all lost commissions because potential buyers / borrowers postponed buying, thinking they would not qualify. That ended last week, and there are now more buyers for your listings.

Bank of America agreed to pay $161,180 to settle accusations that it refused to refinance an Irvine woman’s mortgage because she was on maternity leave, the U.S. Department of Housing and Urban Development announced. According to a HUD statement, the woman applied to refinance her mortgage in December 2009 after a bank agent offered her a new home loan at a 5 percent interest rate with no costs or fees.

A month later, the bank refused to process her application because she was on maternity leave, telling her she would have to return to work full time to get the new loan approved, the woman maintained. The bank still refused to process the application after the woman protested that she earned the same pay and benefits while on maternity leave. Under the settlement, Bank of America will pay $30,000 to the woman, whose name was not released.

An additional $16,180 will go to her attorney and $15,000 will go to the Fair Housing Council of Orange County, a HUD-funded group that received the woman’s complaint. Bank of America also will set up a $100,000 fund to pay future claims stemming from similar accusations.

The HUD statement quoted an unidentified Bank of America official as saying, We regret our treatment of the applicant. This settlement will lead to other banks to complying the Fair Housing Act. If your client has been the victim of (past or present) discrimination…contact a local attorney.

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