When Linda Falcão and her husband applied for a mortgage with U.S. Wells Fargo, they were asked to write a "motivational letter" with essay-like requirements explaining why they were moving.
When Linda Falcão and her husband applied for a mortgage with U.S. Wells Fargo, they were asked to write a "motivational letter" with essay-like requirements explaining why they were moving. The company required them to include in the statement their plans to "increase/decrease in family" and property size.
Falcão was shocked. "It is wrong and invasive to ask people about their family plans," said Falcão, a civil rights attorney and founder of America Serves, a youth volunteer organization, to the The New York Times. "It very much offended me."
Basing a loan decision on a borrower's family status or future plans actually violates the U.S. Fair Housing Act, which prohibits discrimination in lending based on disability, sex or family status.
The couple were ideal loan candidates. Falcão and her husband, both 50, had high credit scores and no debt, and were making a down payment of more than 60 per cent on the new home. Though they tried to be excused from writing the letter, Wells Fargo required it since they hadn't sold their existing home yet.
They filed a complaint with the U.S. housing department but were eventually approved for the mortgage anyway -- and only after they submitted the letter.
