WASHINGTON D.C.—U.S. Senator Mark Pryor today told federal housing agencies that they need to step up enforcement efforts to prevent mortgage discrimination against pregnant women and growing families. 

Recent reports reflect a pattern of lenders who deny home loans to pregnant women or those on maternity leave based on an assumption that the loan applicant will not return to work. While HUD has launched investigations against lenders over the past few years, the discrimination continues. Pryor wants this practice, illegal under fair housing laws, to be met with a zero-tolerance policy.   

Below is a copy of Senator Pryor’s letter to the U.S. Department of Housing and Urban Development and the Federal Housing Finance Agency.  

I am disturbed by the recent reports that pregnant women and parents on maternity or paternity leave are being denied the opportunity to get home mortgages despite being credit worthy borrowers.  These denials are illegal under both the Fair Housing Act and the Equal Credit Opportunity Act.  

The Department of Housing and Urban Development has successfully settled discrimination cases under the Fair Housing Act against several lenders, and I hope this will be a deterrent to others who are also violating the law.  However, I believe more can be done.   HUD must fully enforce the Fair Housing Act and the fair housing provisions included in 12 USC 4545 with zero tolerance so that this discrimination by lenders stops immediately.  

I also believe the Federal Housing Finance Agency (FHFA) can do more to discourage lenders from engaging in this practice and to educate borrowers about their rights.  In its Single Family Selling Guide, published on January 24, 2014, Fannie Mae clarified that maternity leave is defined as “temporary leave”, analogous to short-term medical disability, family medical leave, or other temporary leave types that are acceptable by law.  However, some lenders continue to argue that Fannie Mae and Freddie Mac have not provided clear guidance on income verification for pregnant women and parental leave borrowers.  FHFA should clearly notify all lenders who work with Fannie Mae and Freddie Mac that discrimination against women and families will not be tolerated.  

Women are the primary or equal income earners in 40 percent of households today.  It is ironic that pregnant women and mothers on family leave who easily could have qualified for a home mortgage before they started a family are being penalized right at the time they need to buy a house to accommodate a growing family.  This discrimination is wrong and illegal and your agencies must put a stop to the practice.  

I would appreciate an update on what actions HUD and FHFA are taking to prevent lenders from discriminating against pregnant women and parents on family leave.  Please contact me to schedule a meeting at your earliest convenience.  Thank you.