Racial bias

The Consumer Financial Protection Bureau asked a federal judge to vacate and set aside a settlement against a Chicago mortgage lender, accusing the CFPB of misconduct in a case brought under former Director Kathy Kraninger, a Trump appointee.

Plaintiffs want to certify a class of 119,100 minority mortgage customers who were unfairly deprived of ultra-low mortgage rates during the refi boom.

According to the litigation, a homeowner's Denver property was valued 25% less because of her race.

Researchers from Lehigh University concluded that telling commercially available language learning models, like ChatGPT, to "use no bias" significantly minimized it.

The lender denied its software uses artificial intelligence in fighting a 'digital redlining' case.

Rocket Mortgage relied on a biased appraisal when it denied a borrower's refinance application in Denver three years ago, the housing agency claims.

A federal appeals court ruled that the Equal Credit Opportunity Act prohibits not just outright discrimination but also the discouragement of prospective applicants for credit.

Nikitra Bailey, EVP at the National Fair Housing Alliance, says communities of color are more vulnerable to the impacts of climate change because of prior redlining practices. She explains that a HUD rule could make a big difference.

With millions of Black and Hispanic consumers likely to become new homeowners over the coming decades, the lending community stands to benefit if they are willing to combine expanded underwriting with direct outreach.

In recent years, the wealth gulf between white and Black families has only grown. But there is hope that advances in fintech, such as wider adoption of artificial intelligence, can help.

Plaintiffs seeking class certification claim the bank uses an underwriting system that discriminates against minority mortgage applicants.

Members of the LGBTQ community were most likely to have experienced housing bias, according to a Zillow survey, which also found many people don't recognize how fair lending laws could help.

As part of the settlement, Loandepot will beef up its appraisal policies and practices, it announced.

The Justice Department and the CFPB are increasingly relying on emails among employees that contain discriminatory comments to strengthen their hand in cases against lenders.

A mixed-race couple claims a "whitewashed" valuation in 2023 returned a price 39% higher than the depository-approved result a year earlier.

Across the nation, over 700,000 Black families are "income mortgage-ready," or able to spend 30% or less of their income on a home loan for the typical house in their local market.

Significantly more Americans own a home now than a decade ago, but the disparity between Black homeownership rates and those of other racial and ethnic groups has grown wider, according to the National Association of Realtors.

A look at Home Mortgage Disclosure Act data of similarly situated conforming applicants also finds some lenders' own comments for the rejection doesn't match up with the reason given, the Federal Reserve Bank of Minneapolis said.

As part of a settlement with the Justice Department, Patriot Bank must invest more than $1 million of the total in a loan subsidy fund for minority homeowners and take other corrective steps in its everyday business. The bank denied any wrongdoing.

The lawsuit accuses Navy Federal of violating the Fair Housing Act and the Equal Credit Opportunity Act after a CNN report that the lender approved a lower percentage of Black and Latino mortgage applicants.