Freedom Mortgage Corporation conducts all lending activities in a manner consistent with federal and state fair lending laws. We treat all existing and prospective customers fairly and consistently throughout the loan lifecycle, without regard to any characteristic or basis prohibited by law.
Federal fair lending laws include the Fair Housing Act and the Equal Credit Opportunity Act. Other laws and regulations, including those at the state or local level, contain additional prohibited bases, including, for example, military and veteran status or sexual orientation.
Fair Housing Act
The Fair Housing Act (“FH Act”) is part of the Civil Rights Act of 1968. The FH Act expressly prohibits discrimination in every aspect of a residential real estate-related transaction, including the following:
- Making loans to buy, build or repair a dwelling
- Purchasing real estate loans
- Selling, residential brokering or appraising residential real estate
- Selling or renting a dwelling
The FH Act prohibits discrimination based on any of the factors listed below:
- Race or color
- National origin
- Familial status (which prohibits discrimination against households having children under the age of 18 living with a parent or legal custodian, pregnant women or individuals with legal custody of children under 18)
Two additional factors are expressly prohibited when dealing with loans insured by the Federal Housing Administration (the “FHA”) and the properties securing those loans. In 2012, the U.S. Department of Housing and Urban Development issued a rule that prohibits FHA-approved lenders from basing eligibility determinations for FHA-insured loans on actual or perceived sexual orientation or gender identity.
Equal Credit Opportunity Act
The Equal Credit Opportunity Act and Regulation B, its implementing regulation (together, “ECOA”), prohibit discrimination in any aspect of a credit transaction against any applicant based on any of the following factors:
- Race or color
- National origin
- Marital status
- Age (provided the applicant is old enough and has the capacity to enter into a contract)
- Receipt of income from any public assistance program
- An exercise in good faith of a right under the federal Consumer Credit Protection Act or state law counterpart
As a residential mortgage lender, Freedom Mortgage Corporation is subject to both the FH Act and ECOA.
Other laws and regulations, including those at the state or local level, contain additional prohibited bases, including, for example, military and veteran status or sexual orientation. An example is set forth below.
Massachusetts General Law
Massachusetts General Law, MGL Chapter 151B, prohibits the discrimination of mortgage applicants on the basis of gender identity, sexual orientation, genetic information, ancestry or handicap.
State of Illinois Community Reinvestment Notice
The Department of Financial and Professional Regulation (Department) evaluates our performance in meeting the financial services needs of this community, including the needs of low-income to moderate-income households. The Department takes this evaluation into account when deciding on certain applications submitted by us for approval by the Department. Your involvement is encouraged. You may obtain a copy of our evaluation once the Department completes our first evaluation. You may also submit signed, written comments about our performance in meeting community financial services needs to the Department. We will update this notice when our first evaluation has been issued.
A Word About “Skipping a Payment”
Some customers ask if their new refinance loan will enable them to skip a mortgage payment. Although it might seem that way, that’s not how mortgage payments work.
The first thing to know about mortgages is that they are paid in arrears. That means that the mortgage payment you make on the 1st of the month covers the principal amount due in addition to the interest that accrued on the loan balance from the previous month. For example, your February 1st mortgage payment is the principal payment due for that month and the interest that accrued on the loan balance in January.
Let’s say you refinance your old loan on June 15th. At closing, you pay off the principal balance on the prior loan in addition to the interest that accrued on the balance of the prior loan from June 1st through June 15th. At closing you also prepay the interest that will accrue on the balance of the new loan from June 15th through June 30th. This is the only time you ever pay interest in advance on your mortgage loan.
In this example, no mortgage payment is due on the new loan on July 1st because, at closing, you already prepaid the June interest on the new loan and there is not a principal payment due yet. Your first payment on the new loan will be due August 1st and it will include a principal payment for August and the interest that accrued on the loan balance of the new loan July 1st – July 31st.
You don’t “skip” a July payment because no payment was due for July, either on the prior loan or the new loan.
Notice: The Federal Equal Credit Opportunity Act prohibits creditors from discriminating against credit applicants on the basis of race, color, religion, national origin, sex, marital status, age (provided the applicant has the capacity to enter into a binding contract); because all or part of the applicant’s income derives from any public assistance program; or because the applicant has in good faith exercised any right under the Consumer Credit Protection Act. The Federal agency that administers compliance with this law concerning this creditor is Federal Trade Commission, Equal Credit Opportunity, Washington, DC 20580.
Home Mortgage Disclosure Act Notice
The HMDA data about our residential mortgage lending are available online for review. The data show geographic distribution of loans and applications; ethnicity, race, sex, age, and income of applicants and borrowers; and information about loan approvals and denials. These data are available online at the Consumer Financial Protection Bureau's Website. HMDA data for many other financial institutions are also available at this website.