PNC Settles Maternity Discrimination Charge

PNC Bank is the latest mortgage lender to settle with the Department of Housing and Urban Development regarding violating fair lending protections for women on maternity leave.

"Since 2010, HUD has been investigating lenders who have allegedly violated the Fair Housing Act by requiring women to terminate their maternity leave early in order to qualify for a home loan,” stated John Trasvina, HUD assistant secretary for fair housing and equal opportunity. “HUD will continue to enforce the law and take action against lenders whose loan policies establish different terms and conditions for women who are pregnant or on maternity leave.”

A spokeswoman for PNC said "PNC is committed to serving everyone, regardless of family status. We value the contributions of military families, and we are working to strengthen our ties with them."

HUD alleged that because PNC required a woman borrower who happens to be a Navy veteran to return to work before approving a Veterans Affairs-guaranteed loan, the family could not close on their new home in Newington, Conn., until a month later than they had planned. As a result of the delay, the seller allegedly required the couple to pay an additional $3,000.

PNC will pay $15,000 to the couple. The lender will also have to review applications for VA residential mortgage loans filed in the last two years in Maine, Vermont, Connecticut, New Hampshire, Massachusetts, Rhode Island, Pennsylvania and New York to identify qualified loan seekers whose applications were denied because they were pregnant or on maternity leave. PNC will pay $7,500 to each victim who is identified.

PNC will also revise its Temporary Leave/Short-Term Disability Income policy if HUD finds that the policy is deficient, and will provide fair lending training to its residential mortgage loan originators, underwriters and processors.

HUD has been rather active as of late going after lenders who it claims discriminate against women who are pregnant or on maternity leave.

In June, Bank of America agreed to pay up to $161,180 to settle allegations that one of the bank’s branches refused to refinance the mortgage of an Irvine, Calif., woman because she was on maternity leave.

Then in September, Land Home Financial Services, Concord, Calif., entered into a $20,000 settlement with HUD involving an application where the wife was on maternity leave.

Prior settlements were reached with Cornerstone Mortgage, Houston, and mortgage insurer MGIC Investment Corp. Ironically, according to the original allegations made by HUD against MGIC, the case involved a borrower seeking private MI on a loan being originated by PNC.