The Department of Housing and Urban Development has charged a lender, appraisal management company, and appraiser with racial discrimination and violating the Fair Housing Act in the home appraisal process for the first time since ABC7 News' groundbreaking reporting on the issue created a national conversation and increased awareness.
The charge alleges the appraiser deviated from acceptable methodologies and relied on comparable properties in neighborhoods with greater Black populations and excluded potential comps in neighborhoods with greater white populations. The case could be heard in federal court potentially before a jury if any party chooses that option instead."Under federal law, mortgage lenders are required to work at arm's length during the appraisal process, partnering with independent appraisal management companies who assign the work to state-licensed professional appraisers. The law's intent is to determine the home's value without any input or bias from the lender or any other party with interest in the transaction.
ABC7 News has reported on allegations of discrimination in the home appraisal process for years taking the issue all the way to the White House. Most recently, we shared the story of an East Oakland homeowner who reached a settlement agreement with a California appraiser and a mortgage company after receiving an appraisal that came in more than $300,000 lower than expected.Our America: Lowballed