September 27, 2016
Zoning laws don’t come up much in our discussions about FHA mortgages, but when they do it’s usually about whether a property is eligible for an FHA loan because it is in a mixed-zoning area, or there is some zoning law concern that might affect the sale or purchase of a property.
But recently zoning laws came up in a completely different way, as we learn from the FHA/HUD official site. The Department of Housing and Urban Development has announced a settlement in a Fair Housing case alleging that zoning laws were applied in a discriminatory fashion.
According a press release at www.HUD.gov, “The U.S. Department of Housing and Urban Development (HUD) announced today an agreement with Ridgeland, Mississippi to resolve complaints the city violated the Fair Housing Act when it passed and enforced a zoning ordinance that HUD claimed was motivated by racial animus and created a discriminatory effect on the citys African American residents.”
Such incidents can affect a potential home loan applicant regardless of what stage in the loan application he or she might be; the stability and dependability of rental, temporary, or permanent housing for someone in the loan planning stages, for example, can be crucial to making financial plans for the future.
According to the press release, “In December of 2015, HUD filed a fair housing complaint against the city after receiving reports that a number of apartment complexes faced possible demolition after the city instituted a new zoning requirement that lowered the allowable density.”
Specifically, the HUD official site states, “HUD complained the citys new zoning ordinance called for several of the apartment complexes with the highest minority populations to be amortized, putting more than 1,400 units at risk of being replaced with mixed-use developments.” The agency also alleged that other housing complexes were subjected to “lower density restrictions” which could have resulted in a loss of hundreds of additional apartment units, according to the press release.
Under the settlement agreement, “…the city of Ridgeland agrees to amend the 2014 Ordinance so that multifamily properties are treated as they were prior to the Ordinance when it comes to use and density; provide notice to property managers and/or owners of multifamily properties in advance of any public hearings contemplating changes to existing zoning, land use, and occupancy policies; and process all zoning, land use, building and occupancy approvals and permits in good faith and in a timely manner.”
The city of Ridgeland “also agreed to submit to HUD a proposed Affordable and Fair Housing Marketing Plan which encourages the development of mixed income communities and provides tangible steps for conducting outreach and engaging the residents of Southeastern Ridgeland in the community planning process.”
Sometimes it’s the residents or home loan applicants who are the only line of defense against continued illegal practices-those who report Fair Housing Act violations can help the FHA and HUD settle the issue and prevent more violations. Those who suspect their Fair Housing Act rights have been violated should report the incident to HUD:
1-(800) 669-9777 (voice) or 1-(800) 927-9275 (TTY). Housing discrimination complaints may also be filed by going to www.hud.gov/fairhousing.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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