September 19, 2014
We post news stories about settlements in housing discrimination cases for several reasons, but one of the most important is to remind borrowers that FHA loan applications aren’t immune from problems such as these. The first line of defense against continued violations of the Fair Housing Act usually comes in the form of complaints filed against companies that violate federal law.
With that in mind, we bring news of a recent settlement between HUD and a North Dakota company over housing discrimination complaints. According to press release HUDNo.14-106, ” The U.S. Department of Housing and Urban Development (HUD) announced today that it has reached an agreement with U.S. Bank National Association, U.S. Bank subsidiary Red Sky Risk Services, LLC (formerly known as USB Lending Support Services, LLC), and one of U.S. Bank’s loan officers, resolving allegations that they refused to refinance the mortgage of a Native American couple in Belcourt, North Dakota, because their property is located on a reservation.”
The press release from HUD reminds, “The Fair Housing Act prohibits lenders from discriminating in making mortgages available or in the terms or conditions of a mortgage transaction based on race, color, national origin, religion, sex, family status, or disability.” The alleged discrimination in this case, based on race and national origin, are illegal under Fair Housing laws, but might not have come to light without a formal complaint lodged with the federal government.
“A person’s race and national origin have no effect on their credit worthiness,” said Gustavo Velasquez, HUD’s Assistant Secretary for Fair Housing and Equal Opportunity. “HUD will continue to work to give all families an equal opportunity at homeownership by ensuring that lenders meet their obligation to comply with the Fair Housing Act.”
The press release states that the agreement, “settles a complaint that was filed by a Native American couple alleging that U.S. Bank, the bank’s appraiser Red Sky Risk Services, and one of the bank’s loan officers discriminated against the couple when they attempted to refinance their home loan.”
The HUD release says that by turning down the couple’s loan application, “U.S. Bank allegedly determined that the ‘value or type of collateral was not sufficient.’ The loan officer allegedly told the couple that, because their property is located on a Native American reservation, U.S. Bank was not able to make the loan and that Red Sky Risk Services was not able to appraise the property.”
The property is held in “fee simple,” which HUD says indicates that the couple holds the title to the property, without restriction, in the same way that land is generally held throughout the United States, as mentioned in the press release.
In cases where a borrower suspects illegal discrimination, contact the Office of Fair Housing and Equal Opportunity at (800) 669-9777 (voice) or (800) 927-9275 (TTY). Housing discrimination complaints can also be filed electronically: visit www.hud.gov/fairhousing to learn more.
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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