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DS News Webcast: Friday 10/10/2014

The U.S. Department of Housing and Urban Development has reached a record $5 million settlement with Wells Fargo Home Mortgage, the largest provider of residential mortgage loans in the nation, to resolve allegations that Wells Fargo discriminated against women who were either pregnant or on maternity leave, HUD announced Thursday. The complaints covered in Thursday's settlement were filed by six families nationwide. As part of the settlement, Wells Fargo agreed to distribute $165,000 to the six families and create a fund with at least $3.5 million to compensate other Wells Fargo applicants who experienced maternity leave-related discrimination at the time they applied for a loan.

HUD reported that 190 discrimination complaints related to maternity leave have been filed since 2010, which had resulted in 40 settlements for a combined total of about $1.5 million prior to Thursday's settlement. The complainants say their respective lenders are in violation of the Fair Housing Act, which makes it illegal to discriminate based on race, color, national origin, religion, sex, disability, or familial status for any real estate transaction.

The National Association of Realtors recently sent a letter to the director of the Consumer Financial Protection Bureau urging the agency to adopt a cautious approach as it puts greater scrutiny on brokers operating under the "mini-correspondent" lender model. In a note addressed to CFPB chief Richard Cordray, NAR President Steve Brown asked the director to "be mindful" of certain business concerns when evaluating arrangements between mini-correspondent brokers and lenders so as not to "unduly restrict access to credit."

About Author: Jordan Funderburk

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