Relman Colfax represented Westchester Residential Opportunities, Inc. (WRO) concerning Webster Bank’s policies and practices for applicants and borrowers on maternity, paternity, or adoptive leave.  

WRO’s investigation identified instances in which Webster told  home loan applicants that they had to return to work from maternity leave before their loan could close or that even paid maternity leave status meant they could only be qualified on their spouse’s income. Potential borrowers also were not advised that they could use savings to supplement maternity pay for purposes of qualifying for a loan.

On September 6, 2019, WRO and Webster Bank announced an agreement that includes initiatives designed to ensure that individuals who are on, or plan to be on, maternity, paternity or adoptive leave receive fair and equal access to mortgage loans.

Key features of the agreement include:

  • Implementation of a revised mortgage lending policy to ensure uniform evaluation of an applicant’s income from temporary leave related to childbirth or adoption. 
  • A donation of $225,000 to WRO to support its housing counseling activities, including its first-time home-buying education and counseling program, across the region served by WRO.
  • Establishment of a fund of $700,000 to compensate individuals who might have benefited from the revised lending policy if it were in effect previously.

Webster Bank will also train its staff on the new policy.

The initiatives reflect resolution of allegations of fair lending concerns raised by WRO. Webster denies any wrongdoing as part of the resolution.

Relman Colfax’s team included Sara Pratt, Andrea Lowe, and John Relman, with assistance from paralegals Amanda Borquaye and Isabel Martin.

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