Fair lending regulators believe that the entire mortgage industry may be unfairly discriminating against pregnant women and those on maternity leave. Two new legal actions indicate that there may be discrimination against these women that can not only lead to delayed closings, but that may even lead to mortgage applications being denied despite good qualifications[1]. John Trasvinia, HUD assistant secretary for fair housing and equal opportunity, has said on numerous occasions that “pregnancy is not a basis to deny or delay a loan.” However, in at least two cases it appears that this is exactly what happened. One mortgage’s insurance was delayed “unless and until the wife returned to work from maternity leave,” while another lender denied a loan application outright when it learned that the applicant “would be on leave from her employment.” In the latter case, the lender claimed that the denial was based on a failure to disclose this information rather than because of the nature of the leave (pregnancy) itself.
Critics of these types of practices say that penalizing a woman for getting/being pregnant is outdated and unfair because “the assumption is that women may not be returning to their jobs.” However, many women do opt to remain at home with their new children for several years after birth – even if they had originally planned to return to work immediately. Factors like the cost of childcare can influence this decision in addition to social pressures and personal beliefs about a baby’s level of need for its mother during early development[2]. If you factor in these additional “risks” for lenders who might approve a loan based on an income that an expectant mother may decide not to maintain after giving birth, one can understand why a lender might be concerned. We know that it is illegal for lenders to do so, but do you think that it is fair to factor in the risks to a loan that a pregnancy entails?
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[1] http://www.latimes.com/business/realestate/la-fi-harney-20110612,0,7194091.story
[2] http://exclusive-executive-resumes.com/professional-resumes/women-going-back-to-work-after-a-baby/
IDIOTS!!!! WHERE DO THEY THINK WE ALL COME FROM?
THIS IS GENDER SPECIFIC DISCRIMINATION, AND SHOULD BE SEVERELY PUNISHED. AS FAR AS I AM CONCERNED, THIS IS CRIMINAL IN NATURE, AS WELL AS CIVIL CONTEMPT OF THE LAW.
JIM MYERS
When I was in the Lending business working for a Large Savings Bank, we got a letter from the employer stating that her job will be there when she returned from leave and we also got a letter from the borrower stating that she planned to return to work when her leave was over. The letter from the borrower was important in the case of foreclouser and any posible litigation that might follow. No need to turn down those loans for that reason.