People with limited English proficiency (LEP) are protected under the Fair Housing Act (FHA) under new guidance announced by the U.S. Department of Housing and Urban Development (HUD). Housing providers can face liability for taking adverse actions against an individual because of their limited ability to read, write, speak, or understand English.

The guidance reasons that LEP persons are protected because of their close nexus with the protected class of national origin. Approximately 9 percent of the U.S. population is LEP.

The new guidance instructs that housing providers violate the FHA if they intentionally discriminate against a person because of their LEP. For example, it would violate the FHA to selectively refuse to rent to, or to refuse to renew a lease for, persons who speak a certain language, but rent to those who speak another language. The guidance suggests that defenses used in the employment context against LEP discrimination lawsuits, such as the legitimate importance for employers to be able to communicate with their employees, will be inapplicable in the housing context.

Even if unintentional, housing providers may still face liability for LEP discrimination under the "discriminatory effects" or "disparate impact" theory. The U.S. Supreme Court recently recognized disparate impact theory as cognizable under the FHA. The guidance explains that discriminatory effect liability arises when facially neutral policies have an unintentional but nevertheless discriminatory effect on a protected class where the housing provider has no substantial, legitimate, nondiscriminatory interest for advancing the policy. For example, a seemingly facially neutral policy of not allowing documents to be translated could violate the FHA under the new guidance.

Informal agency guidance like this does not carry the force of law akin to formal agency rulemaking. Instead, courts are empowered to provide agency guidance and the proportionate amount of deference that the court deems a situation merits, based on a variety of factors. Nevertheless, housing providers should take this new guidance seriously, as it may influence suits brought by plaintiffs or decided by courts. Blanket advertising requirements that all tenants must speak English or restrictions on the languages that residents may speak amongst themselves are heavily susceptible to FHA liability and should be avoided. Under the guidance, justifications for language-related restrictions should strictly relate to essential housing-related matters.

Lenders should also pay close attention to the guidance and any ensuing lawsuits. It states that targeting certain LEP groups who share national origin for housing-related services on unfair terms, such as home loan modifications, likewise constitutes illegal discrimination. Other examples of LEP discrimination under the FHA in the lender context include refusing to allow mortgage documents to be translated, restricting a borrower’s use of an interpreter, or requiring an English speaker to co-sign a mortgage.

This prohibition on LEP discrimination in the housing context is an expansion of HUD's 2007 formal regulations concerning the obligation of programs that receive federal financial assistance to refrain from discriminating against LEP persons. Under those regulations, recipients of federal financial assistance have an obligation under Title VI of the Civil Rights Act to assist LEP persons with access to federally funded programs. The new HUD guidance, in contrast, interprets LEP discrimination under the FHA, which applies much more broadly to most rental and home sales whether or not federal assistance is involved, as well as lending activity.

Ballard Spahr's Housing Group regularly represents and advises clients, including rental property owners, on a range of issues related to the Fair Housing Act, and defends a variety claims brought under its provisions.


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