Top Federal Credit Union Practices Discrimination: Report

( – A report suggests that Navy Federal Credit Union has the highest discrepancy in mortgage approval percentages between white and black applicants. NFCU is the largest credit union in the US.

The bank’s approval rate for new conventional house purchase mortgages was above 75% for white borrowers in 2022, while it was below 50% for black borrowers. This disparity was the largest among the 50 mortgage lenders in percentage points last year, at roughly 29 points.

The discrepancy remains Even when comparing applicants with comparable earnings and debt-to-income ratios. When comparing white borrowers with annual incomes of $62,000 or less to black borrowers with incomes of $140,000 or more, NFCU marginally authorized a larger proportion of the former.

According to a CNN investigation, over twice as many black applications as white ones were rejected.

According to its website, all active-duty military, veterans, and their families are welcome at NFCU.

A black Texan business owner, Bob Otondi, claimed that the 2021 denial of his mortgage application by NFCU was illogical.

He was then approved for a loan by another lender within two weeks.

He told CNN that he had suspected racist bias but had been unable to provide evidence.

Amidst a jump in interest rates in 2022, Navy Federal Credit Union turned down over 3,500 black applicants for mortgages.

Latino borrowers were likewise authorized at lower percentages than white borrowers by NFCU.

Navy Federal spokesman Bill Pearson justified the lending policies, emphasizing their legal dedication to fair lending regulations and equal and equitable treatment of borrowers.

According to Pearson, CNN’s research misrepresents their business procedures as it ignores crucial factors that all banks consider when granting a mortgage, such as a borrower’s credit history, the amount of liquid assets on hand, and the lender’s connection with the borrower.

The investigation showed that when it comes to lending to minorities, Navy Federal has met with success. Its black customer base accounts for one-fourth of its conventional loan applicants, and black borrowers received over 18% of its conventional loans, more than any other major lender.

According to CNN, even though more black borrowers are seeking conventional mortgage loans from NFCU, the credit union seems to be denying most of them due to the wide racial difference in their approval rates.

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