A government report, Banking on Women, investigated the issue after the Institute for Public Policy Research questioned whether women were being treated fairly.
While it found little evidence of prejudice against women, the report noted there was a long-standing belief among borrowers that this was the case. As a result, the CML and the Building Societies Association have agreed to publish information for both lenders and consumers on the issue.
The report stated: “Evidence of systemic discrimination against women in either business lending or mortgage lending to women who are pregnant or on maternity leave at the time of application was not uncovered by the review.
“The review did identify two over-arching issues which need to be addressed: a long-standing perception that lenders discriminate against women; and, there is more that the financial sector can do to take women into account, as part of their customer base, including in engagement activities.”
The lender bodies will produce guidance by the end of 2013 informing women who are pregnant or on maternity leave what they should expect to be asked when applying for a mortgage and what should not be asked. They will also outline to members permissible areas of inquiry in relation to such women.
By April 2014, lenders are expected to have adapted the sales and underwriting processes to take the guidance into account and train front-line staff on the issue of pregnancy and maternity leave.
BSA head of mortgage policy Paul Broadhead said women were crucial customers for mortgage lenders: “It is clear that we are dealing with perception here but there is still no room for complacency, particularly in the run up to the implementation of the new mortgage rules from the Financial Conduct Authority.
“These will see lenders having to ask many more questions of all mortgage applicants to ensure loans are affordable.”
Over three-quarters of mothers who were working return to work within 18 months of giving birth and 84% of these went back to work for the same employer. Over half continued to work full-time, and overall two-fifths of those who returned worked between 16 to 29 hours.
