The Department of Housing and Urban Development on Monday approved a conciliation agreement between JPMorgan Chase and a consumer over alleged undervaluing of her property based on race.
The settlement calls for the bank to pay $50,000 to an unnamed Chicago woman and require its staff to undergo training in fair lending practices as they relate to appraisals. The appraisals were done by independent contractors, JPMorgan Chase noted in a statement.
“We did extensive research into the matter and take these complaints very seriously," the bank said. "Our internal review of the appraisal assessment, as well as a market analysis, found no substantive issues and supported the appraisers value.”
The Biden administration has called on HUD to keep a close eye on
“The race of a homeowner and the racial composition of their neighborhood must not influence the valuation of a home,” said Jeanine Worden, HUD’s acting assistant secretary for fair housing and equal opportunity, in a press release.
“Discrimination in home buying, mortgage lending, and property appraisal deprives qualified individuals of an equal opportunity to pursue homeownership as a path to family stability and financial security,” she added.
Lenders reported that 14% of all denials involving Black consumers applying for refinances were based on collateral, according to a recent American Enterprise Institute analysis of public and private data from 2018 and 2019. The equivalent rate for purchases was 8%.
Data analyzed in the report came from the Home Mortgage Disclosure Act, the Collateral Risk Network’s survey of appraisal management companies and lenders and other sources.
The appraisal and mortgage industries have worked to address appraisal bias concerns and
In 2020, 2.3% of property appraisers and assessors were Black professionals, according to
