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You are here: Home / Featured / Bank of America to Pay $160,000 to Settle Maternity Discrimination Claim

Bank of America to Pay $160,000 to Settle Maternity Discrimination Claim

June 11, 2012by Jeff Dillman

On June 7, 2012, the U.S. Department of Housing and Urban Development (HUD) announced that Bank of America agreed to pay up to $161,180 to settle allegations that one of the bank’s brances in San Jose, California, refused to refinance the mortgage of woman because she was on maternity leave. HUD reached the agreement with Bank of America to resolve a Fair Housing Act complaint that had been filed by the Fair Housing Council of Orange County (FHCOC).

According to the HUD press release announcing the settlement:

The woman told FHCOC, a non-profit fair housing organization funded by HUD, that in December 2009, a Bank of America agent offered her a 5% interest rate for a home refinance loan, with no costs or fees. But in January 2010, after she had applied for the loan and supplied the necessary documents, the bank allegedly refused to process her application because she was on maternity leave. In her complaint, the woman alleged that a bank agent told her that she would have to return to work full-time in order for her loan to be approved. Even after she informed the bank that she received the same rate of pay and benefits while on maternity leave, the bank would not process her application. In March 2010, the bank finally approved the woman’s application, but by that time the interest rate on her loan had increased to 5.25%, making each loan payment higher.

A Bank of America official said: “We regret our treatment of the applicant. We take our Fair Lending responsibilities very seriously and will work with HUD to ensure our customers on maternity leave are treated appropriately during the mortgage application process.”

Under the terms of the settlement, Bank of America will pay $30,000 to the woman, $16,180 to her attorney, and $15,000 to FHCOC. Bank of America will also create a $100,000 Compensation Fund to pay damages to loan applicants or borrowers who may have been denied a loan, subjected to adverse loan terms, or had their loan applications delayed because they were pregnant or on maternity leave. In addition, the bank is requiring all of its loan officers nationwide to complete annual fair lending training.

North Carolina residents who believe they have suffered discrimination are urged to contact the Fair Housing Project at (855) 797-3247.

To read a copy of the HUD press release announcing the settlement, click here.

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Filed Under: Featured, News Tagged With: HUD, lawsuit, lending, maternity, mortgage, sex/gender

Previous Post: « Court Rules Against Westchester County, NY; HUD Withholds CDBG Funds
Next Post: DOJ Announces $10 Million Settlement in Disability Discrimination Case »

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    Fair Housing Project
    P.O. Box 26087
    Raleigh, NC 27611-6087
    1-855-797-3247
    info@fairhousingnc.org

    Our Mission

    The Fair Housing Project of Legal Aid of North Carolina works to eliminate housing discrimination and to ensure equal housing opportunity for all people through education, outreach, public policy initiatives, advocacy and enforcement.

     

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    Disclaimer

    The materials contained on this website are for information and education purposes only and do not constitute legal advice. Legal Aid of North Carolina does not provide legal assistance by email. Contact the Fair Housing Project or a private attorney if you need to speak with an attorney regarding your particular situation. View our complete disclaimer.

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