PhotoThe Consumer Financial Protection Bureau (CFPB) is reminding lenders not to impose illegal burdens on mortgage applicants who receive Social Security disability income.

“Everyone deserves the opportunity to qualify for a mortgage that they can afford,” said CFPB Director Richard Cordray. “Consumers should not be put at a disadvantage just because they receive Social Security disability income. Lenders should continue to make fair and responsibly underwritten mortgages without imposing unnecessary requirements on consumers who receive these benefits.”

A bulletin issued to lenders (.pdf) today calls attention to standards and guidelines that may help lenders comply with the law, and help ensure that recipients of Social Security disability income receive fair and equal access to credit.

More than 15 million people receive Social Security disability income every year, including many who are veterans of the U.S. armed forces. For those relying on this income, qualifying for a mortgage can be a challenge when lenders ask for proof of how long they will receive their benefits.

The Social Security Administration generally will not provide documentation regarding how long benefits will last. Some applicants have reported being asked for information about their disabilities or even for doctors’ notes about the likely duration of their disabilities.

The Equal Credit Opportunity Act (ECOA) prohibits creditors from discriminating against an applicant because some or all of the applicant’s income is from a public assistance program, which includes Social Security disability income. 


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