SANTA ANA, Calif. – A Latino civil rights organization is suing a national mortgage lending company for its policy of unlawfully denying a loan to a recipient of DACA (Deferred Action for Childhood Arrivals) based on his immigration status, according to papers filed in federal court last week.
MALDEF (Mexican American Legal Defense and Educational Fund) filed suit against Rocket Mortgage, LLC on behalf of Miguel Estrada Avila, 40, of Santa Ana, California. MALDEF attorneys argue the mortgage company’s decision to deny Estrada a loan solely because of his immigration status, rather than base it on his credit-worthiness, violates Section 1981 of the federal Civil Rights Act of 1866 and California’s Unruh Act. Together, these laws prohibit discrimination based on citizenship and immigration status.
“Irrational discrimination remains a drag on our economy that must end,” said Thomas A. Saenz, MALDEF president and general counsel. “This includes unlawful discrimination on the basis of immigration status, especially against DACA recipients making real and enduring contributions to our economic growth.”
In July 2022, Estrada applied to Rocket Mortgage for a $341,000 loan to purchase an investment property in Riverside, California. Estrada previously secured a loan with Rocket Mortgage for his primary home at the time, and had complied with the terms of the loan until it was sold.
As part of his application, Estrada provided the lender with his Social Security number, his status as a DACA recipient, and information regarding his assets and employment. As a recipient of DACA, Estrada is authorized to work in the U.S. However, when the closing date of the sale approached, Estrada was asked by a third party representative for Rocket Mortgage to provide proof that federal immigration officials had received his application for DACA renewal, which he filed on July 30, 2022. In response, Estrada submitted a letter from his immigration services provider stating that his DACA status was valid through October 26, 2022. The mortgage broker then informed Estrada that Rocket Mortgage would not move forward with the loan unless he could provide proof from U.S. Citizenship and Immigration Services (USCIS) that his renewal application had been received.
A week later Rocket Mortgage cancelled the loan, and Estrada lost $7,500 when the purchase of the property fell through. When Estrada inquired about why the transaction was cancelled, he was told it was because his DACA status would expire within 90 days of the sale closing.
“Selective discrimination is discrimination nonetheless,” said MALDEF staff attorney Eduardo Casas. “Rocket Mortgage arbitrarily and unlawfully moved the goal post on our client solely because of his immigration status even though they had issued him a loan before and would have had adequate collateral.”
Rocket Mortgage is an online mortgage company that operates in all 50 states. It has no physical branches; it is headquartered in Detroit.
“After I got rejected for the loan I was depressed for some weeks,” Estrada said. “I felt discriminated against and really sad that I had lost money and lots of time. I was motivated to buy the house because I wanted to help the people who were living there. I always think that we need to help each other no matter what.”
The lawsuit was filed in the U.S. District Court, Central District of California, Southern Division.
This is the 15th lawsuit filed by MALDEF since 2017 challenging the policies of financial institutions that discriminate against DACA recipients.
Read the complaint HERE.