On January 17, 2025, the CFPB took action against Draper & Kramer Mortgage Corporation for discriminatory mortgage lending activities that discouraged homebuyers from applying to Draper for homes in majority-Black and Hispanic neighborhoods in the greater Chicago and Boston areas. CFPB Director Rohit Chopra said that the Bureau’s proposed order bans Draper from mortgage lending for five years and ensures that the company pays for its unlawful discrimination.

Draper & Kramer Mortgage Corporation is a non-depository mortgage lender based in Downers Grove, Illinois. The CFPB alleges that between 2019 and 2021, Draper participated in redlining predominantly Black and Hispanic communities in the greater Chicago and Boston regions, which led to its lending activities in these areas being notably lower than those of its competitors. The CFPB said that Draper violated the the Equal Credit Opportunity Act and Regulation B by:

Intentionally focusing mortgage lending activities in majority-white neighborhoods and excluding Black and Hispanic neighborhoods. Draper lacked offices, loan officers, and marketing efforts in majority-Black and Hispanic neighborhoods in Chicago and Boston. The company did not assign loan officers to these communities or train them to lend there, focusing instead on majority-white neighborhoods.
Discouraging mortgage applicants from pursuing properties in majority-Black and Hispanic neighborhoods. Draper’s business model discouraged borrowers from applying for loans in majority-Black and Hispanic neighborhoods. In comparison, Draper’s peer lenders generated loan applications in these areas at over two-and-a-half times the rate in Chicago and three times in Boston. Additionally, Draper originated significantly fewer mortgage loans in these neighborhoods, with peers originating two-and-a-half times more.

If entered by the court, the CFPB’s order would require Draper to cease residential mortgage lending activities for five years and pay a $1.5 million penalty.

Read the CFPB’s press release here.

The Proposed Order can be found here.

Adam Witmer

Adam Witmer is a speaker, author, and founder of the Compliance Cohort. Adam has taught hundreds of seminars and training sessions to thousands of bankers throughout the United States and teaches on all areas of regulatory compliance. Adam has written five e-books that he never published, hit a grizzly bear while driving in a National Park, and is an award winning photographer and musician (though he no longer takes photos nor plays any instruments). In his spare time, Adam can be found kayaking on the lake, doing taekwondo with his kids, working on his (project) house, or spending time with his family.

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