Two Black women are suing Navy Federal Credit Union, claiming their rejected home loans are due to their lending practices, obtained by Atlanta Black Star.
The class action lawsuit, filed Sunday, comes after an explosive analysis from CNN that revealed the federal credit union significantly denied Black mortgage applicants compared to their counterparts.
The report found that Navy Federal approved over 75 percent of conventional home mortgage loan applications for white borrowers, while the approval rate for Black borrowers was under 50 percent in 2022. Plaintiffs Cherelle Jacob, 40, and Laquita Oliver, 44, say they were both denied this year.
“What is clear is that Navy Federal’s residential loan origination program has a discrimination problem,” the complaint alleged. “Plaintiffs experienced this discrimination firsthand.”
Jacob, an educator who lives in Washington state, and her husband, an armed forces member, decided to submit a mortgage application to Navy Federal to purchase a “modest family home,” according to the lawsuit. They preferred to use Navy Federal because of the accessibility at different army bases around the world.
The couple makes an estimated $200,000, has credit scores above 800, and has no debt. Despite this, they were turned down.
“After the Navy Federal denial, Plaintiff Jacob and her husband were able to secure a mortgage for the same property from a mortgage broker,” the lawsuit stated. “The mortgage broker they found was, for Plaintiff and her husband, less desirable than Navy Federal would have been because it lacked the convenience for service members purportedly offered by Navy Federal.”
Oliver had a similar experience. In August, she applied for a mortgage to purchase a $400,000 home she believed she was qualified for. Per the filing, the process took months, and her credit score took a hit, which resulted in Navy Federal charging a fee.
The capital improvement project analyst, who makes $100,000 annually, was eventually denied. When she raised concerns, the lawsuit alleges that she was ignored and then instructed to file an appeal. She decided against it to avoid lowering her credit again or paying more fees.
National civil rights attorney Ben Crump and personal injury attorney Adam Levitt represent the mortgage applicants.
“The outright discrimination that occurs when Banking While Black continues to reveal itself in the lending practices of many of America’s largest financial institutions,” Crump said in a statement. “It is shameful that Navy Federal, an organization that prides itself in helping the families of men and women who served their country, does not give their Black and Latino customers the same opportunities as White customers.”
