WASHINGTON — The Department of Housing and Urban Development is taking a harder look at how mortgage lenders treat borrowers with limited English language skills.

The agency issued new guidance last week emphasizing that the Fair Housing Act also protects homebuyers with limited English proficiency, or LEP.

"Having a limited ability to speak English should never be a reason to be denied a home," Gustavo Velasquez, HUD assistant secretary for fair housing and equal opportunity, said in a press release. "Every family that calls this nation home has the same rights when it comes to renting or buying a home, regardless of where they come from or language they speak."

The guidance specifically mentions mortgage brokers and lenders in relation to providing LEP borrowers with access to mortgage programs, according to Amy Glassman, a partner at the Ballard Spahr law firm in Washington. It also clarifies HUD's position that discrimination against persons with limited English proficiency can be considered discrimination based on national origin.

"I see the LEP guidance as focusing on the nexus between the lender's responsibilities and the potential for Fair Housing Act violations. It calls attention to the issue," Glassman said in an interview. "Whether it results in increased complaints and investigations, I don't know."

Nearly 9% of the U.S. population is limited in English proficiency, according to HUD. Approximately 65% of these individuals speak Spanish, while 7% speak Chinese, 3% speak Vietnamese, 2% speak Korean and 2% speak Tagalog.

"Housing decisions that are based on limited English proficiency may have a greater impact on these and other groups because of their nationality," HUD said in the press release.

Sara Pratt, a senior counsel at Relman, Dane & Colfax, noted this is the first time HUD has signaled to mortgage lenders that LEP borrowers are covered and protected by the Fair Housing Act.

"I think it is possible you will see cases brought against lenders by individuals who have had the front door slammed in their face," she said in interview.

HUD is aware of cases where lenders have refused to allow Hispanic and other non-English-speaking borrowers to take the loan documents and get them translated.

"HUD is not requiring lenders to translate loan documents," Pratt said. But lenders shouldn't block borrowers from getting a translation. "There is no justification for that," she said. Lenders generally give borrowers a few days to review loan documents.

In some cases, lenders will insist on a co-signer to ensure a borrower with limited English skills understands the terms of the loan. However, a "lender can't require an English-speaking person co-sign a loan," Pratt said.

Lenders should also allow the borrower to use an interpreter or translator before signing loan documents.

Pratt expects to see more formal guidance from the regulators going forward. She noted many of the large lenders are already taking steps to serve people who speak other languages.

"This is a message to lenders: Don't lock the front door on people simply because they speak a language other than English. Figure out ways to work with them," she said.

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