June 3, 2011
Outrage of the week: On maternity leave? No home loan for you!
NWjobs
There are so many reports of maddening workplace and work-related practices these days that I've decided to create a recurring feature called Outrage of the Week. This week's outrage:
[Photo by Flickr user Xbeckie boox]
The New York Times has reported that a Kenmore oncologist who was approved for a mortgage while pregnant was later dumped by her lender for taking maternity leave, despite her leave being 100 percent paid. Houston-based lender Cornerstone Mortgage told Elizabeth Budde, 34, that it could not finalize her loan because "maternity leave is classified as paid via short-term or temporary disability income" -- in other words, income that couldn't help her qualify for a loan.
Budde and her real estate agent eventually were able to prove to Cornerstone Mortgage that she was indeed collecting her entire salary while on maternity leave, and the lender approved her loan. The Department of Housing and Urban Development added some icing to the cake when it brought a complaint against Cornerstone Mortgage, claiming it violated the Fair Housing Act, which protects borrowers against such discrimination. Although the mortgage company maintains it violated no laws, it awarded Budde $15,000 in damages and created a $750,000 settlement fund for other pregnant borrowers who come forward with the same complaint against the lender.
I get that the lending market has greatly clamped down since the recession. (I experienced this firsthand last year while trying to secure a home loan as a full-time freelancer. Banks have a hard time understanding that self-employed people can make enough money to pay their bills.) But denying loans to people on paid family leave? What's next -- rejecting home loan applicants who work for companies having a bad quarter?
Have an outrageous workplace news item to share? Feel free to send it my way. I may use it in a future post.
Michelle Goodman is the author of "My So-Called Freelance Life" and "The Anti 9-to-5 Guide." E-mail Michelle at mgoodman@nwjobs.com
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health care, hiring practices, outrage of the week, work/life balance, working parents
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Michelle Goodman is the author of "My So-Called Freelance Life" and "The Anti 9-to-5 Guide."
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Bert on June 16, 2011 10:34 PM | Reply
It is ridiculous that people with jobs but no savings can get a loan, but self-employed people with great credit and tons of savings are turned down. Those people with jobs could get laid off tomorrow, while the people with savings and great credit will always pay their bills.