The Consumer Financial Protection Burea (“CFPB”) has reached a settlement with PNC Bank which acquired Naitonal City Bank over lending violations. National City Bank allegedly discrminated against minority borrowers in the mortgage business.
Foxbusiness.com reports that, “The regulators said Cleveland-based National City violated the Fair Housing Act and the Equal Credit Opportunity Act by charging more than 75,000 African American and Hispanic borrowers higher loan prices not based on borrower risk but due to their race or national origin. Those borrowers will be eligible for compensation from National City, which was acquired by Pittsburgh-based PNC in 2009 for more than $5 billion.” The full story is available here.
The impact of the discrimination accorind to the FoxBusiness.com was that,” the subjective pricing discretion led to minorities paying more than similarly qualified non-Hispanic White borrowers, the regulators said.”
Therefore, minorities could be paying several tens of thousand more for the same loan despite similar credit scores as non-minorities. Thus it is critical that National City will pay compensation to these borrowers who have otherwise incurred unnecessary cost because of the banks illegal practices. For more information go to the CFPB website here.
As a bankruptcy lawyer in Baltimore, Maryland, I often assist homeowners in foreclosure save their home and loan modification is one way to achive that. Therefore, I have dealth with various mortgage servicers and some of them can be very difficult to deal with. It is good to see the CFPB and other regulators continue their efforts to root out companies enagaing in bad practices and hopefully this will stop future violations.
For more information got the CFPB website and please note that claims are always time sensitive so make sure you pay attention to deadlines. If you have any questions do not hesitate to contact me.
Joseph K. Githuku