By Jacqueline Fuller

The recent allegations that Navy Federal Credit Union discriminated against Black mortgage applicants highlights how racism is still a force in maintaining the racial wealth gap. When a lender denies someone a loan based on something other than their creditworthiness, the individual experienced lending discrimination.

Fair Lending Regulations
The federal fair lending laws are the Equal Credit Opportunity Act and the Fair Housing Act. These laws are in place to prohibit discrimination in credit transactions, including transactions related to residential real estate.

The Equal Credit Opportunity Act is enforced by the Federal Trade Commission. Under this Act, it makes it illegal for creditors to discriminate based on race, color, religion, national origin, sex, marital status, age, or because all (or part) of a person’s income comes from public assistance.

The Fair Housing Act is enforced by the U.S. Department of Housing and Urban Development (HUD). The Act protects consumers from discrimination when they are renting or buying a home, getting a mortgage, seeking housing assistance, or engaging in other housing-related activities. It is also known asTitle VIII of the Civil Rights Act of 1968.

Prepare to Apply for a Mortgage
Before you start the process to apply for a home loan, the best advice is to prepare ahead of time before submitting an application. Here are some tips that can make the process easier and work in your favor to obtain a loan.

  • Check your credit report: This will give you time to review it for any errors and dispute them with the credit bureaus. You can get a free copy of your report at annualcreditreport.com.
  • Confirm and clear up past debts: After you reviewed your report for accuracy, contact the businesses listed to verify the debt and make arrangements to pay off the balance.
  • Estimate how much you can afford to pay each month: The figure you come up with will help you apply for a loan that works with your budget.
  • Determine your down payment: The amount you can put down will determine the type of loans you are eligible to apply.

Make Your Voice Heard If You Suspect Discrimination
If you think that your loan application was rejected, charged you more for a loan, or offered you less-favorable terms based on the indicated factors for illegal discrimination,  the following options are available to file a complaint:

  • Speak with the lender’s ,manager about your concerns on why were denied a loan
  • Submit a complaint with the Federal Trade Commission online or call 855-411-CFPB (2372)
  • Submit a complaint with HUD online or call 1-800-877-8339

Lawyer Up!
If you need legal advice on what steps to take to file a lawsuit with a lender, contact a lawyer that specializes in fair lending laws. You can also contact your state attorney’s office to inquire about how to proceed with a complaint.

This journey toward homeownership is also an opportunity to review your experience with your current financial institution and reevaluate if it’s a good fit for you. If their practices do not respect you or sabotage your financial goals, the next step to consider is to move your money to a bank or credit union that will meet your needs to achieve economic prosperity.

This post was originally published on The Washington Informer.