Study finds Same-Sex Couples Discriminated Against in Applying for Mortgages

The study published in the Proceedings of the National Academy of  Sciences found that mortgage lenders were  73% more likely to deny same-sex couples a home loan and charge them more for it. This was compared to heterosexual couples with the same financial worthiness, according to an analysis of national mortgage data from 1990 to 2015. On average, same-sex couples were given inferior terms when they were approved for a loan. They  paid 0.2% more in interest and fees - $86 million a year. 

It is legal for lenders to charge higher fees if there is greater risk, but the study found same-sex couples slightly are better regarding possible defaults, according to Lei Gao, an assistant professor at Iowa State University’s Ivy College of Business and co-author of the study.  

The study's researchers said their findings show the need: (1) to include sexual orientation as a protected class under federal lending laws to guarantee same-sex couples equal access to credit, and (2) that credit monitoring agencies should investigate unfair lending practices. A change in the law in necessary because while the Fair Housing Act and the Equal Credit Opportunity Act outlaw discrimination against borrowers on the basis of race, color, religion, sex or national origin, they do not include sexual orientation.  

In related news, HUD is reviewing Twitter’s and Google’s ad practices as part of housing discrimination probe.

[Redlining was banned 50 years ago. It’s still hurting minorities today.]

https://www.washingtonpost.com/business/2019/04/17/same-sex-couples-applying-mortgage-face-higher-rejection-worse-rates-study-finds/?noredirect=on&utm_term=.83f34e096003

RECENT FAIR HOUSING NEWS

Same-Sex Couples 73% More Likely to be Denied Mortgage. The just-published analysis of 2009-2015 national mortgage date compared same-sex couples' experiences to that of heterosexual couples with the same financial worthiness, according to an analysis of national mortgage data from 1990 to 2015. The researchers say their findings signal a need to include sexual orientation as a protected class under federal lending laws. 

Published in the Proceedings of the National Academy of Sciences, the study also found that when same-sex couples were approved for a home loan, they were given inferior terms. They paid an average of 0.2% more in interest and fees, which totals annually up to as much as $86 million. https://www.washingtonpost.com/business/2019/04/17/same-sex-couples-applying-mortgage-face-higher-rejection-worse-rates-study-finds/?noredirect=on&utm_term=.c072a491e8cb.

State Farm Agrees to Pay $250 Million, Avoids Racketeering Trial. The payment is to customers who claimed the company tried to rig the Illinois justice system to wipe out a $1 billion jury verdict from 19 years ago. The largest U.S. auto insurer apparently led an effort to get a judge friendly to its cause for the Illinois Supreme Court, secretly funding Judge Lloyd Karmeier’s 2004 election campaign by giving money through advocacy groups that were not required to disclose donors. Under the federal Racketeer Influenced and Corrupt Organizations Act, any damages would have been tripled. A judge granted preliminary approval to the accord and set a final fairness hearing for December. https://www.insurancejournal.com/news/national/2018/09/04/500127.htm.

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