CFPB: Lenders Cannot Request Certain Social Security Disability Income Information
The Consumer Financial Protection Bureau (CFPB) released a blog posting and bulletinon November 18, 2014, about lenders impermissibly asking for proof regarding the length of time a consumer will continue to receive social security disability income.
When someone applies for a mortgage they generally will have to provide income information. However, for those that receive social security disability income, the recipient normally does not have documentation related to how long they expect to continue to receive the income.
According to the CFPB, fair lending concerns are raised if a lender requires additional documentation to prove the length of time the benefits are expected to continue, such as a statement from a doctor or a specific description of the disability.
Financial institutions should be careful to avoid asking for impermissible documentation pertaining to the expected length of time a consumer will continue to receive social security disability income.
CLA’s financial institution regulatory compliance team assists banks and credit unions nationwide in establishing regulatory compliance programs, conducting compliance testing, and training staff on regulations. Justin Robinson is a member of CLA’s regulatory compliance team and can be reached at justin.robinson@CLAconnect.com.
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