Lending Practices Perpetuate Gender Discrimination

According to investigations by HUD and the NY Times, accessing a mortgage is more arudous if you are a pregnant mother. The Department of Housing and Urban Development (HUD) reports regular complaints that banks and brokers deny women loans based on pregnancy or maternity leave.  Some lenders (including PNC Bank) single pregnant women out for different treatment and offer them different, less desirable mortgage products (when they do not deny them outright.) The Fair Housing Act prohibits discrimination against a renter or a homeowner based on sex or familial status, and this gender-based discrimination in lending practices is illegal. Ciswomen, transwomen, and allies, spread the word — gender discrimination is influencing lending practices!

Many lenders refute allegations about gender discrimination by pointing to new, more conservative practices in general following the mortgage crisis. However, this claim is based on outdated and incorrect assumptions about women’s real experiences, including job loss or unwillingness to return to paid employment. The Pregnancy Discrimination Act guarantees women job security while on maternity leave — it is illegal for an employer to replace an employee due to pregnancy. And now, more than ever, women are returning to work after pregnancy. According to the Bureau of Labor Statistics, over 50 percent of women return to work after childbirth.

As the current housing crisis has shown us, Discriminatory practices in mortgage lending has horrific ramifications. Today, the foreclosure crisis is felt most acutely by Black and Hispanic home-buyers, who were deemed “too risky” for traditional mortgage instruments. Minority and low-income homeowners were manipulated by lenders into costly, sub-prime mortgages, many of which came with unaffordable, balloon payments and quickly fell into foreclosure. (Read this op-ed on the 80/20 mortgage problem for more information.) If lenders (illegally) refuse pregnant women traditional mortgages, they re-open the door to non-bank and high-cost mortgages that very obviously hurt families.

MomsRising, a group of women and allies organize around the most critical issues faced by women, are taking a stand. The organizers at UHAB stand in solidarity with MomsRising and all those that are unfairly denied mortgages. But correcting practices within banks is not enough. The United States is one of eight countries without paid maternity leave. Of these eight, the United States is the only country with a stable economy and supported infrastructure. If we had paid maternity leave, discriminatory practices in the mortgage market may become inexistant. In addition to holding banks accountable, we need to hold our elected officials accountable for stronger policies that protect working, pregnant women.

If you are experiencing gender discrimination when seeking a mortgage, call HUD at 800-669-9777.

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