The Department of Housing and Urban Development said it reached an agreement with CMG Mortgage Insurance Co. to settle a Fair Housing Act complaint regarding allegations the private mortgage insurer refused to issue a policy because the wife on maternity leave.
CMG, which at the time of the complaint was co-owned by PMI Mortgage Insurance Co. and CUNA Mutual, will pay $5,000 to the couple involve and give $25,000 to “a qualified organization” to educate the public about their fair lending rights, including those regarding borrowers on maternity or paternity leave.
According to the settlement document obtained on the HUD website, a married couple went to Mountain America Credit Union to refinance their mortgage. The wife was on maternity leave.
MACU reportedly required the couple to get mortgage insurance and then denied the loan based on CMG’s underwriting guidelines pertaining to the calculation of income for women on maternity leave.
CMG settled the complaint without admitting or denying guilt.
“A woman’s maternity leave is not a legitimate basis for
CMG MI will develop new nondiscriminatory guidelines regarding calculating maternity, paternity, and pregnancy leave income, and train its employees and employees of credit unions that have underwriting responsibilities about these new guidelines, HUD said.
CMG is still in