The Department of Housing and Urban Development and Alpine Bank & Trust have reached an agreement to resolve claims that the lender discriminated against African-American and Hispanic mortgage applicants.

The Rockford, Ill.-based company will create a $1 million loan program designed to grow mortgage lending to residents of areas with African-American and Hispanic majorities as part of the agreement, HUD said Friday. The bank will also provide fair lending training to its staff and offer community outreach to minority neighborhoods such as homeownership and credit counseling.

The agreement settles a complaint brought forth by HOPE Fair Housing Center in Wheaton, Ill. The organization claimed that Alpine was discriminating against minority applicants by having little presence in these communities. According to the complaint, only one of Alpine's 14 locations was in a census tract that was more than 10% African-American.

By not having branches in minority neighborhoods, HOPE argued that Alpine was providing white applicants with better information and more favorable terms and conditions.

Alpine agreed to pay $75,000 to HOPE as part of its deal with HUD. The bank also agreed to explore the possibility of opening a new automated services branch in a majority-minority neighborhood in the Rockford area. Additionally, Alpine will conduct a direct mailing campaign in predominantly African-American areas.,

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Jacob Passy

Jacob Passy

Jacob Passy is a reporter with National Mortgage News, covering breaking news in the residential mortgage industry.