HUD: Bank of America violated Fair Housing Act

The trouble continues for Bank of America (BAC). According to a press release issued Monday, the U.S. Department of Housing and Urban Development (HUD) alleges the bank is guilty of discriminating against borrowers with disabilities.

This is just one in a string of allegations against B of A, one of the nation's largest banks.

HUD claims Bank of America "imposed unnecessary and burdensome requirements on borrowers who relied on disability income to qualify for their home loans and required some disabled borrowers to provide physician statements to qualify for home mortgage loans."

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According to the report, Bank of America allegedly asked borrowers to provide proof of their disabilities and the continuation of their Social Security income before approving loans, after first denying them. If the allegations are true, B of A violated the Fair Housing Act.

"Holding homebuyers with disabilities to a higher standard just because they rely on disability payments as a source of income is against the law," John Trasvia, HUD assistant secretary for Fair Housing and Equal Opportunity, said in the press release. "Mortgage companies may verify income and have eligibility standards but they may not single out home buyers with disabilities to delay or deny financing when they are otherwise eligible."

According to Reuters, Bank of America said "there is no basis to allege that Bank of America has engaged in a systemic practice of discriminating on the basis of disability in connection with mortgage lending."

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The Fair Housing Act makes it illegal to discriminate based on race, color, national origin, religion, sex, familial status or handicap. This includes imposing different application or qualification criteria based on disability. Fair Housing also makes it illegal to inquire about the nature or severity of a disability except in limited circumstances which, according to HUD, are not applicable in this case.

The allegations are based on a secretary-initiated investigation of complaints filed by two borrowers in Michigan and one borrower in Wisconsin.

[kimnchris69]

My family is still having trouble with Bank of America's mortgage remodication practices? We have been trying to remodify our loan since the beginning of last year until finally, the mortgage department came down from Richmond to take our information. They told us we had to be 2 months behind to qualify. We turned in all of our paperwork needed in September 2011. A month went by with no response. We went to the bank to make a payment in October and the teller returned our money. Once someone finally returned our calls, our paperwork that was submitted had expired after two months of waiting and we had to resubmit them. We received a letter saying our home was going to be foreclosed on. We then received a letter in December giving us a foreclosure date for December 29th. Our counselor told us that we need not to worry. We wanted to pay the back payment but our counselor, Rafael, gave us the balance and told us to hold on to the money until he called us back in 45 minutes. Once he called us back, he told us that there was no foreclosure date. He told us that we could put the money at the back end of the loan. Two months later while foreclosure fees were still acruing; we were denied the remodification. So it took them 5 months to tell us that we didn't qualify, when we took it to HUD, it took them under an hour to tell us we didn't qualify. NOW THEY EXPECT US TO COME UP WITH ALMOST $12,000 when we are only a little over $ 8,600 (THAT WE COULD PAY TODAY) behind on the mortgage and the rest are fees for a foreclosure that BANK OF AMERICA INITIATED (KNOWING WE WERE GOING THROUGH THE REMODIFICATION PROCESS)AND KEPT POSTPONING THE DATES DRIVING UP THE FEES . The whole process is a SCAM !!!! WE THE TAX PAYERS HAVE BEEN FORCED TO BAIL OUT THESE BANKS YET THEY CONTINUE TO STICK IT TO THERE CUSTOMERS. BANK OF AMERICA is not practicing in good faith. BEWARE OF THE SCAM!!!

[DidHeSayThat]

How DARE Bank of America ask HOW you are going to pay back the loan?

Shame on them... Welcome to the NEW AMERICA.

[IBBuckshot]

Let's use some common sense. Not everyone on disability is permanently disabled. Just because a person is on disability now, or has been on disability even for the last two years let's say, does not mean they are permanently disabled. If I am going to sell my home to a buyer and carry the mortgage myself as an example, I would want to know if the buyer is permanently disabled (forever) and can count on his income to make the house payment. What if he has to recertify to continue the income and if he doesn't then he has to go get a job. By the same token how can any mortgage lender qualify anyone because they may be working for the past twenty years, then qualify for a loan and loose their job the day after closing. Sounds like a gamble business.

[gjc1n1]

Ever notice that whenever the media reports mortgage wrongding that it is ALWAYS Bank of America that tops the list? How does this pile of excrement manage to stay in business?

[MegaProcrastination]

So how does someone with a monthly income of less than $1,000 a month qualify for a mortgage?

[tapittwice]

I can't believe that Bank Of America would be accused of wrong doing? How horrible! Hey I have an idea, let's give them some more taxpayer money to make them feel better.

[DidHeSayThat]

at this point, the government is saying they cannot even ask sensible and reasonable questions. So, yeah, the taxpayer owes them.