Questions a Mortgage Lender Should Never Ask

So, you’re ready to buy a home and are preparing your paperwork to apply for a home loan. There are a lot of details you don’t want to leave out and a good lender will be sure to ask you for all of the information needed to get you the loan and the rate you deserve. But there is a line of questioning you should be aware of when working with your home lender.  

While it may seem like lenders can ask you just about anything they want, there are some red lines, according to Darrin Q. English, senior community development loan officer for Quontic online bank. These questions, he says, are on his “do not ask” list:

Sexual Orientation

A person’s identity in relation to the gender or genders to which they are sexually attracted to has absolutely nothing to do with getting approved for your home loan. Although an individual’s sexual orientation is a BIG part of who they are and how they define themselves, it should never affect their chances at getting approved for a home loan. Or any loan, for that matter.

Who you choose to share your intimacy and love with is your business. Not your mortgage lenders.

Disabilities

A disability is any condition of the body or mind (impairment) that makes it more difficult for the person with the condition to do certain activities (activity limitation) and interact with the world around them (participation restrictions). If you are someone that qualifies as disabled in one form or another, you already understand the challenges such limitations can create for you. So, don’t create anymore limitations for yourself.

Even though a disability contributes to the development of the amazing, triumphant, badass that you are, not everyone can see this. The perception of people with disabilities has evolved in our modern-day world but there is still a lot of very old, false information out there that denies those with disabilities as the incredible, independent, and capable people they truly are. If a lender should inquire about your disability there’s a good chance, they may share some of these old and inaccurate “facts” about people with disabilities. Play it safe and keep this personal information to yourself. Also, consider finding yourself another mortgage lender to work with.

Family Expansion Plans

Now, while a lender can ask how many children you currently have and their ages, they can’t ask if you plan to have more or discriminate based on familial status. This isn’t aways made clear to future homebuyers during the application process. So, be sure when you get to this question that you only provide your lender with your current family status.

 

Political or Religious Beliefs

In general, it’s good practice to never discuss politics or religion in business. But the topic does come up from time to time. After all, they are topics that are important to us, and they make up a significant portion of how we identify with our communities and the world. Still, your political preferences and religious beliefs should stay under your hat when applying for a home loan.

Medical History

Although this may seem like a no brainer, a lender can’t discriminate based on your medical history. That’s between you and your doctor(s). If for some reason a lender asks about it, don’t feel you have to say anything. Other than “that’s simply none of your business.”

Race

Let it be known that a creditor such as a lender or broker cannot discriminate based on race or color. Sadly, the practice of segregation within the housing market and housing communities of the United States is still an uphill battle for many Americans. For people of color, this is an issue that certainly does not go unnoticed.

Before the pandemic, it was common practice for any future homebuyer to walk into their local mortgage lending office to seek the help of a home lender. Since it’s rather difficult hiding your race in person, a home lender could easily and ignorantly judge a book by its cover. But we live in a whole new world of technology and there is a good chance that you may never have to meet your home lender in person.

With non-visual communication tools such as email and your mobile phone, all your conversations can be left to audio. And thanks to platforms such as DocuSign, you don’t even have to go into an office to sign off on some of your life’s most important contractual obligations.  

If you’re concerned that you race or color could affect your experience with home lending in a negative way, working with a lender (or any real estate professional for that matter) through these non-visual channels of communication could ease your stress and reduce the chances of being discriminated against.

Other…

There may be other protected classes enforced by your state, as well. So, be sure to out those classes before beginning your journey with a lender.

If You See Something, Say Something

Have you encountered a mortgage lender who has asked you, a family member, or friend about any of these forbidden topics? If you have, keeping this information to yourself may only hurt other future homeowners on their journey to securing the right home loan for them.

The Department of Housing and Urban Development (HUD) enforces the Fair Housing Act. This law prohibits lenders from denying credit because of certain characteristics, such as the ones listed above. If you have experienced any of these types of discrimination, file a complaint with the CFPB. You are protected from discrimination, and you have the right to be heard. So please, speak up.  

 

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