Sisemore

We address here whether a licensed family daycare home operator who allegedly suffered discrimination in applying for a home loan may state a legally cognizable claim for discrimination under the Fair Employment and Housing Act (FEHA), Government Code section 12955 et seq. The daycare home operator claims, inter alia, that the lender’s action violated FEHA because it (1) constituted intentional discrimination on the basis of the borrower’s source of income, and (2) had the effect of discriminating against women and families with children.

Plaintiff and appellant Kim Sisemore (Sisemore), the mother of a young child, is a licensed operator of a family daycare home. She sought a mortgage loan from defendant and respondent Master Financial, Inc. (Master Financial), to facilitate her purchase of a San Jose home. She was turned down; Master Financial stated in writing that it “does not lend on day care homes.” Shortly thereafter, plaintiff and appellant Project Sentinel, Inc., a nonprofit fair housing organization (Project Sentinel), obtained written confirmation from Master Financial that it “will NOT make loans with home day care if the home day care income is required to…