Report finds banks, others discriminate against communities of color
WASHINGTON DC – The National Fair Housing Alliance (NFHA) and 17 of its local member organizations announced the results of a major undercover investigation into the failure of banks and property preservation companies to maintain and market foreclosed homes in African-American and Latino neighborhoods. The investigation of Real Estate Owned (REO) homes in 30 major metropolitan areas found disturbing incidents of discrimination in how these banks and Fannie Mae’s preservation management companies fail to secure the doors and windows, mow lawns, fix gutters and downspouts, remove trash, and provide other maintenance for REOs in African American and Latino neighborhoods, while providing these services for their REOs located in White neighborhoods.
A report detailing the findings of the investigation, “Zip Code Inequality: Discrimination by Banks in the Maintenance of Foreclosed Homes in Neighborhoods of Color,” was released today. It details the results of the investigation of more than 2,400 REO properties located in and around 30 major U.S. cities. The report is the third released by NFHA (similar reports and results were published in 2011 and 2012) and provides information about the broadest investigation to date into REO discrimination. Both the White neighborhoods and neighborhoods of color investigated were middle and working class communities with high foreclosure rates and high owner-occupancy rates. The investigation avoided zip codes with high levels of renters or investor-ownership.
“This report documents the ongoing threat to communities of color across America: that zip code determines whether banks properly maintain and market the homes titled in their names,” said Shanna L. Smith, President and CEO of the National Fair Housing Alliance. “The banks and property preservation companies are under contract to maintain these homes. They are supposed to get the best price when selling a foreclosed home. Banks and Fannie Mae are obligated to make sure lawns are mowed, shrubs are trimmed, mail is stopped, and flyers are removed from the porch. They are also responsible for ensuring that the gutters are cleaned to stop water or ice damage, windows and doors are secured and repaired, trash and dead animals are removed, emergency numbers that actually work are posted, and professional “For Sale” signs are placed in the yard. Banks fulfill these obligations in predominantly White neighborhoods but overwhelmingly fail to perform these simple routine maintenance chores in middle and working class African-American and Latino neighborhoods.”
Read the report: http://bit.ly/reo2014.