Limited English Proficiency (LEP) refers to a person’s limited ability to read, write, speak, or understand English. The Fair Housing Act (FHA) prohibits housing providers from using LEP selectively based on a protected class or as a pretext for discrimination because of a protected class. The Act also prohibits housing providers from using LEP in a way that causes an unjustified discriminatory effect. Improper handling of transactions with LEP customers can lead to FHA violations on mortgage loans, Equal Credit Opportunity Act (ECOA) violations on any type of loan and to Unfair, Deceptive or Abusive Acts or Practices (UDAAP) concerns on any type of account. HUD released guidance on September 15, 2016 entitled, “Fair Housing Protections for Persons with Limited English Proficiency,” to advise housing providers of these prohibitions.
The Limited English Proficiency Procedures Update helps ensure compliance the HUD guidance by implementing steps to prohibit discrimination associated with limited English proficiency and race and national origin. Procedure Updates are designed to simplify the task of updating existing procedures, regardless of where the existing requirement is lodged. Each set of procedures are completely customizable and includes an overview of the new requirements, a regulatory citation, effective date, operating procedures, control procedures, and audit procedures.