Maternity Discrimination Complaint to Cost BofA More than $160K

The ""Department of Housing and Urban Development"":http://portal.hud.gov/hudportal/HUD (HUD) announced Thursday that ""Bank of America"":https://www.bankofamerica.com/ has agreed to pay $161,180 to settle allegations of maternity-based discrimination.

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A complaint had been filed by the ""Fair Housing Council of Orange County"":http://www.fairhousingoc.org/ (FHCOC) against BofA alleging that one of its San Jose branches refused to refinance a woman's mortgage because she was on maternity leave. The Fair Housing Act prohibits discrimination in mortgage lending and real estate-related transactions based on race, color, national origin, religion, sex, family status, or disability. BofA was alleged to be in violation of the provisions protecting sex and family status.

""The Fair Housing Act prohibits lenders from denying home loans to women because they are pregnant or on maternity leave,"" said John Trasviña, HUD Assistant Secretary for Fair Housing and Equal Opportunity. ""Today's settlement follows HUD actions involving other lenders across the country which we will continue until maternity leave discrimination is eliminated.""

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The women told FHCOC that a BofA agent in 2009 offered her a 5 percent interest rate for a home refinance loan with no costs or fees. After she applied for the loan and supplied the necessary documents in January 2010, the bank allegedly refused to process her application because she was on maternity leave. The woman alleged in her complaint that a bank agent told her she would have to return to work full-time in order for her loan to be approved. The bank refused to process her loan even after she revealed she received the same pay and benefits while on maternity leave. The bank did approve her loan in March 2012, but the interest rate had increased to 5.25 percent by that point.

A BofA official had a statement about the incident: ""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 Conciliation Agreement, BofA will pay $30,000 to the woman, $16,180 to her attorney, and $15,000 to FHCOC. The rest of the settlement will go to create a $100,000 Compensation Fund to pay damages to loan applicants 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. The bank is also requiring all of its loan officers nationwide to complete annual fair lending training.