WASHINGTON–Ten senators have signed on to two separate letters sent to the leaders of the Department of Housing and Urban Development and the CFPB asking that they “thoroughly review” mortgage lending practices at Navy Federal Credit Union.
As CUToday.info has been reporting, the letters come in the wake of a CNN report that alleged mortgage lending bias at Navy Federal. CNN said its analysis found the widest disparity in mortgage approval rates between White and Black borrowers of any major lender, with the world’s largest credit union approving more than 75% of the White borrowers who applied for a new conventional home purchase mortgage in 2022, but less than 50% of Black borrowers who applied for the same type of loan.
The report alleges similar bias against Hispanic and Latino borrowers.
The findings were based on the most recent data available from the CFPB. Navy FCU has challenged the findings, saying they are incomplete.
Review is Urged
The letters from the senators to the respective agency leaders cite the CNN reporting and ask each regulator to “review Navy Federal's mortgage lending practices and outcomes for compliance with the Fair Housing Act and the Equal Credit Opportunity Act (ECOA).
“While it is appropriate for a lender to deny a mortgage application when the loan will not be sustainable for the borrower, those decisions are made based on a borrower’s financial ability to repay the loan. It should go without saying that a person’s race, or any other protected characteristic, should never be a factor,” the letter goes on to say. “As the regulators with primary responsibility for enforcing ECOA and the Fair Housing Act, we ask that you thoroughly review Navy Federal’s mortgage lending practices and outcomes for compliance with all federal fair housing and fair lending laws and regulations. Navy Federal’s members have made countless sacrifices in their service to our country. We must do all we can to ensure illegal barriers are not placed on their path to homeownership.”
The Signatories
The letter was signed by Sens. Sherrod Brown (D-OH), chairman of the Senate Committee on Banking, Housing and Urban Affairs; Tina Smith (D-MN), Ron Wyden (D-OR), Raphael Warnock (D-GA), Jack Reed (D-RI), John Fetterman (D-PA), Robert Menendez (D-NJ), Tim Kaine (D-VA), Catherine Cortez Masto (D-NV), and Chris Van Hollen (D-MD).
Related Issues
- A lawsuit has been filed against Navy Federal in federal court related to the claims made in the CNN report. Additional information is available here.
- Navy Federal has retained a leading civil rights lawyer, Debo P. Adegbile, former commissioner on the United States Commission on Civil Rights, to assess its mortgage lending policies and practices and “make recommendations to drive further access to home ownership.”