VIENNA, Va.–Additional details have become available on the class action lawsuit filed against Navy Federal Credit Union over alleged mortgage bias.
As CUToday.info has reported, the lawsuit was filed shortly after an analysis was published by CNN that found a nearly 29 percentage-point gap at Navy FCU between the credit union’s rate of acceptance for Black mortgage applicants (48.5%) and Latino applicants (55.8%) in 2022 compared with White applicants (77.1%).
The class-action suit filed against the $165-billion Navy Federal claims the credit union has violated the Fair Housing Act and the Equal Credit Opportunity Act in allowing the lending disparity.
The Plaintiffs
Two lead plaintiffs in the suit have now been identified. According to the Atlanta Black Star, plaintiffs Cherelle Jacob, 40, and Laquita Oliver, 44, say they were both denied this year.
“What is clear is that Navy Federal’s residential loan origination program has a discrimination problem,” the complaint alleged, as cited by the Atlanta Black Star. “Plaintiffs experienced this discrimination firsthand.”
According to the report, Jacob, an educator who lives in Washington state, and her husband, an armed forces member, applied for a mortgage through Navy Federal to purchase a “modest family home.” The couple makes an estimated $200,000, has credit scores above 800, and has no debt. Despite this, they were turned down, the Atlanta Black Star reported.
‘Less Desirable Option’
“After the Navy Federal denial, Plaintiff Jacob and her husband were able to secure a mortgage for the same property from a mortgage broker,” the lawsuit states, as cited by the Black Star. “The mortgage broker they found was, for Plaintiff and her husband, less desirable than Navy Federal would have been because it lacked the convenience for service members purportedly offered by Navy Federal.”
According to the Atlanta Black Star, Oliver had a similar experience. “In August, she applied for a mortgage to purchase a $400,000 home she believed she was qualified for. Per the filing, the process took months, and her credit score took a hit, which resulted in Navy Federal charging a fee,” the report stated, noting she was eventually denied a mortgage.
Civil Rights Attorney Hired
National civil rights attorney Ben Crump and personal injury attorney Adam Levitt represent the mortgage applicants, the Atlanta Black Star reported.
“The outright discrimination that occurs when Banking While Black continues to reveal itself in the lending practices of many of America’s largest financial institutions,” Crump said in a statement, quoted by the Black Star. “It is shameful that Navy Federal, an organization that prides itself in helping the families of men and women who served their country, does not give their Black and Latino customers the same opportunities as White customers.”
Navy Federal Responds
As CUToday.info reported here, Navy Federal Credit Union has issued a statement that “We treat the recent allegations very seriously, and we have retained a leading civil rights lawyer, Debo P. Adegbile, former commissioner on the United States Commission on Civil Rights, and his team to assess our mortgage lending policies and practices and make recommendations to drive further access to home ownership.”
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