Race Discrimination Alleged In Subprime Predatory Lending Lawsuit Filed In Boston; Class Action Status Sought

The Boston Globe reports:

• "Three African-American mortgage borrowers from Boston accused Countrywide Home Loans Inc. of racial discrimination in a federal lawsuit yesterday, saying the nation's largest home lender charged them more for subprime mortgages than it charged white borrowers in similar financial situations. The lawsuit ... contended Countrywide violated federal housing discrimination laws because the black homeowners in Boston paid higher fees to the network of agents that generate Countrywide's new customers. The company, the suit said, uses an "unchecked, subjective surcharge" that adds to the total costs of loans for its customers, and black borrowers, it contended, paid more than whites. The suit seeks class-action status and more than $100 million to reimburse black customers of Countrywide and its subprime subsidiary, Full Spectrum Lending Inc., including about 10,000 in Massachusetts."

This lawsuit, filed by Massachusetts attorney Gary Klein on Thursday in a Boston Federal Court, comes on the heels of a suit filed on Wednesday by the NAACP in a Los Angeles, California Federal Court in which it sued a dozen subprime lenders for "systematic racism," charging blacks were 30 percent more likely to pay higher interest rates than whites (see NAACP suit targets mortgage lenders - Rights group alleges whites offered better terms than blacks on home loans).

Reportedly, similar litigation alleging discrimination in predatory lending practices against Argent Mortgage Co. and Wells Fargo Bank is also pending in Cleveland, Ohio (see Sue The *astards! - What To Do About Mortgage Brokers And Lenders Who Don't Play Fair?).

Last December, the New York Attorney General reached a settlement with Countrywide in which the company must monitor its lending practices to prevent discrimination against blacks and Latinos (see New York AG Press Release - 12-5-06).

For more, see Borrowers sue subprime lender, allege race bias (Countrywide denies blacks were charged more in fees).

For a copy of the Boston Federal lawsuit, see Miller, et al. vs. Countrywide, et al.

Go here, Go here and Go here for more on recent Countrywide problems with consumers.

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Cleveland Fair Housing Lawyer Files Predatory Lending Class Action Lawsuit

The Cleveland Free Times recently featured fair housing attorney Ed Kramer and his firm, Housing Advocates Inc., of Cleveland, Ohio. Regarding Kramer's predatory lending, foreclosure clients, the report states:

• "[T]here was an unmistakable pattern: Nearly all were poor people of color, and all had been locked into unaffordable loans, with high interest rates and exorbitant broker fees."

Kramer determined that there was no way to represent everyone in need, and that the problem wasn't going away and couldn't be solved on a piecemeal basis. According to the story:

• "So, after 32 years of applying state and federal fair housing statutes to defend clients against unfair housing providers, Kramer decided it was time to use the same laws differently. In April, Kramer turned plaintiff and filed a class-action complaint that goes past individual brokers and at the banks and mortgage companies that, he says, paid the brokers to target African Americans. The suit represents a tectonic shift in how predatory lending cases are handled. Case-by-case approaches have left attorneys and investigators unable to detect larger patterns of racially motivated lending. But now, Kramer's new approach, and pricing data available only since 2004, has emboldened a host of players - all separately coming to the conclusion that it's time to switch targets: to the banks and investment firms."

Kramer's firm itself filed the suit against Argent Mortgage Co., reputed to be the biggest subprime lender in Cleveland, in addition to Wells Fargo Bank. Reportedly, the Fair Housing Act allows organizations to file complaints if the discrimination in question is taxing their resources.

The article also describes the efforts of Ohio Attorney General Marc Dann, who is pursuing both criminal and civil actions through the statewide Predatory Lending Task Force which he created. He is also using Ohio's racketeering statutes and working with other law enforcement agencies and coordinating cases around racketeering charges.

For more, see Sue The *astards! (What To Do About Mortgage Brokers And Lenders Who Don't Play Fair?)

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City Of Baltimore To Target Wells Fargo In Federal Race Bias Suit Alleging Discriminatory Predatory Lending

In Baltimore, Maryland, The Baltimore Sun reports:

• In a potentially groundbreaking lawsuit intended to stem foreclosures in Baltimore, Mayor Sheila Dixon's administration is suing a leading mortgage provider for what the city says has been a pattern of predatory lending in black neighborhoods. The lawsuit, which the Dixon administration plans to file today in U.S. District Court, alleges that California-based Wells Fargo Bank sold higher-interest subprime mortgages to blacks more frequently than to whites and that the practice, known as reverse redlining, violates federal housing law. Lenders are increasingly coming under legal attack from borrowers and investors stung by the subprime mortgage crisis, but Baltimore's lawsuit could be the first in the nation in which a city is attempting to recapture costs associated with foreclosed homes that wind up vacant.

***

• "They knew that the minority community was so desperate to get loans because they had been denied credit for so long," said John Relman, a partner at the Washington law firm Relman & Dane, which the city hired to help litigate the case. "They knew that people were so ready to say yes to anything that they went in there and charged them higher rates."

For more, see Lawsuit by city targets lender (Subprime mortgages unfairly marketed to blacks, it alleges).

See also:

• Baltimore Is Suing Bank Over Foreclosure Crisis (The New York Times),
• Baltimore lawsuit will accuse bank of predatory lending practices (The Associated Press),
• City sues Wells Fargo (Examiner.com).

To view the lawsuit, see Mayor and City Council of Baltimore v. Wells Fargo Bank, N.A., et al. (8.76 MB).

Representing the City Of Baltimore is the Washington, D.C. law firm Relman & Dane.

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Baltimore Files Suit Against Wells Fargo Alleging Discriminatory Predatory Lending Practices In Violation Of Fair Housing Act

In Baltimore, Maryland, The Baltimore Sun reports:

• Baltimore homeowners could receive counseling and financial support - including short-term loans to help avoid foreclosure - if the city wins the predatory and discriminatory lending lawsuit it filed yesterday against Wells Fargo Bank, Mayor Sheila Dixon said. [...] The lawsuit, filed in U.S. District Court in Baltimore, has been in the works since early last year, when city attorneys started to review foreclosure data. Wells Fargo issued a statement Monday saying the lender does not engage in illegal discrimination. City officials estimate that they could win "tens of millions" in damages if they prevail in the lawsuit and that a chunk of that money would be funneled into public programs to aid homeowners struggling with mortgages with adjustable interest rates.

For more, see City files suit over foreclosures (If Baltimore prevails, homeowners could receive counseling and financial support) (no longer available online).

See also:

• Baltimore Is Suing Bank Over Foreclosure Crisis (The New York Times),
• Baltimore Sues Wells Fargo for Subprimes (The Associated Press).

To view the lawsuit:

• see Mayor and City Council of Baltimore v. Wells Fargo Bank, N.A., et al. (8.76 MB) (available online courtesy of the Washington, D.C. law firm Relman & Dane, representing the City of Baltimore), or
• lawsuit also available here courtesy of Public Citizen's Consumer Law & Policy Blog, or
• go to this this direct link on the PACER system (approx. 11 MB - PACER registration required - 39 pages - $2.40).

For yesterday's post, see City Of Baltimore To Target Wells Fargo In Federal Race Bias Suit Alleging Discriminatory Predatory Lending.

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Homeowner Lawsuits Seeking To Undo Subprime Loans Pick Up Steam

American Association for Justice reports:

• Amid the subprime mortgage crisis, many people across the country—with both good and bad credit—have found themselves stuck with loans that are not what they anticipated. Mortgage lenders and related institutions are under intensifying scrutiny for a wide range of illegal conduct, including misrepresenting loan terms, adding bogus fees, inflating appraisals, committing securities fraud, and discriminating against borrowers based on their race and gender. Lawsuits allege violations of the Truth in Lending Act (TILA), the Fair Housing Act, the RICO statute, and state consumer protection laws, to name a few.

***

• The option ARM has proved especially problematic. “It’s a subprime product being marketed to everybody,” said Jeffrey Berns, a Tarzana, California, lawyer, whose firm has filed 60 federal class actions against major lenders over option ARMs. He noted that these clients range “from doctors and lawyers to field workers.”

***

• Paul Kiesel, a Beverly Hills, California, lawyer, also represents borrowers suing over option ARMs. His firm has filed 56 class actions, most of which revolve around TILA violations, all on behalf of borrowers who stand to lose their primary residences. He estimated that half had loans with low interest rates before signing up for the option ARMs. “They were eligible for far better mortgages than they got,” he said.

• If the terms are not adequately disclosed, a mortgage is rescindable, but the general public may not be aware of that, Kiesel said. He and his colleagues have built a consortium of firms to work together—which is necessary because “we have taken on the largest lenders in the United States, and they have unlimited resources,” he said. “We are facing such an imminent threat” of people being forced out of their homes that lawyers have a responsibility to take on this type of litigation.

***

• The problem is acute in Cleveland, where foreclosure rates are among the highest in the country. Cleveland lawyer Edward Kramer and his firm have more than 25 cases pending over predatory-lending practices, most arising from foreclosure actions. [...] More recently, the Cleveland-based public-interest law firm Housing Advocates, Inc., which Kramer directs, filed a complaint with the Ohio Civil Rights Commission against Argent Mortgage Co. for racial discrimination, claiming that the company offered loans that were likely to result in foreclosure in mostly African-American neighborhoods. The commission investigated and found that the evidence substantiated the alleged discrimination claim. [...] (Housing Advocates, Inc. v. Argent Mortgage Co., (CLE)H4(38066)05212007, 05-07-0938-8 (Ohio Civ. Rights Commn. Mar. 13, 2008).) A hearing is to follow. [...] The complexity of mortgage securitization—determining which company is doing what—makes things difficult for plaintiffs, Kramer said, because “no one’s taking personal responsibility.” [...] “It’s not an easy situation,” Kramer said, but “if we could get lawyers to take a case or two, we could have a tremendous impact in the community.”

For more, see Predatory-lending litigation looms.

For other posts on homeowners using Federal & state consumer protection statutes to try and undo bad mortgage loans, Go Here, Go Here, and Go Here.

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Washington State Files Administrative Action Accusing Countrywide Of Discriminatory, Predatory Lending Practices

In Seattle, Washington, The Seattle Times reports:

• Countrywide Home Loans is facing a $1 million fine and the loss of its mortgage business in Washington after a state agency determined that it charged minority borrowers more for its loans than it charged white borrowers in similar circumstances.

• The company also could be forced to pay restitution to at least 50 borrowers the state says were victimized by the company's discriminatory pricing, according to administrative charges filed Monday by the [Washington] State Department of Financial Institutions.

• The action is the state's first ever fair-lending case, and could pressure the company — and possibly other lenders — to modify loan terms for state homeowners who are struggling to repay mortgages with high interest rates that are continuing to climb, said Deborah Bortner, director of DFI's consumer services division.

For more, see State accuses Countrywide of discriminatory lending (Countrywide Home Loans is facing a $1 million fine and the loss of its mortgage business in Washington after a state agency determined that it charged minority borrowers more for its loans than it charged white borrowers in similar circumstances).

See also:

• Seattle Post Intelligencer: State accuses Countrywide of bias (It proposes fine of $1 million),
• Governor's office press release: Gov. Gregoire announces alleged discriminatory lending by Countrywide Home Loans.

To view the Statement of Charges filed by the state, see In re Countrywide Home Loans.

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Texas Homeowner Files Suit Alleging Race Bias, Truth In Lending Violations In Predatory Refinance

In Baytown, Texas, The Houston Chronicle reports:

• Nanette Lewis refinanced her mortgage to get peace of mind. Instead, she says, she got a bait-and-switch, predatory loan and heartbreak. Now far less naive, the Baytown woman decided to fight back. In a lawsuit she filed against her lenders in federal court last week, she alleges she was targeted for a loan with onerous terms because she's black. Her suit mirrors one filed by the attorney general of Massachusetts and another by the city of Baltimore.

• All three accuse lenders of "reverse redlining" — targeting minority loan applicants for the worst possible mortgage deals. Lewis' lawsuit may be the first of its kind in Texas. She is represented by a legal aid lawyer and seeking primarily, she said, to get the word out about what happened and to remove the lien from her property, though she still would be responsible for repaying the mortgage.

***

• When she was laid off, Lewis worried she'd miss a mortgage payment and lose the house. She went to Lone Star Legal Aid to see how she could keep the home safe. Lawyer Sapna Aiyer said she was surprised at Lewis' "horrible, horrible" mortgage terms. Aiyer said the lawsuit cites the federal Home Ownership and Equity Protection Act and the Texas Constitution, which bar lenders from excessive points and fees (more than 8 percent) and from certain changes in loan terms at closing.(1)

For more, see Lawsuit over signing shock (Baytown woman sues lenders, says she was a victim of predatory lending practices because she's black).

For the homeowner's lawsuit described in this story, see Lewis v. Alpha Mortgage, et al.

The non-profit legal services firms representing the homeowner are Texas RioGrande Legal Aid (Austin, Texas; provides free legal services to low-income and disadvantaged clients in a 68-county service area that covers the southwestern third of the state, including the entire Texas-Mexico border region) & Lone Star Legal Aid (Houston, Texas; serves 72 counties in the East Region of Texas and 4 counties in Southwest Arkansas).

For the race bias-related lawsuits referenced in the story filed by Massachusetts & Baltimore City, see:

• Commonwealth of Massachusetts v. H&R Block, Inc., et al.,
• Mayor and City Council of Baltimore v. Wells Fargo Bank, N.A., et al. (8.76 MB).

For a July, 2008 study on Mortgage Lending & Race, see the National Community Reinvestment Coalition Study: Income Is No Shield Against Racial Differences in Lending.

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(1) The lawsuit alleges violations of Home Ownership and Equity Protection Act (15 U.S.C. §§ 1602(aa) and 1639); the Truth in Lending Act (15 U.S.C. § 1601 et seq. and § 1640(a)); the Equal Credit Opportunity Act (15 U.S.C. § 1691- 1691 (f)); the Fair Housing Act (42 U.S.C. § 3605); and the Texas Constitution, Article 16, §50(e)(2). PredatoryLendingRaceBias

Mass AG Accuses Lender Of Race-Based Discrimination In Predatory Lending Practices In Civil Suit

(originally posted 6-3-08)
In Boston, Massachusetts, Reuters reports:

• Massachusetts authorities sued H&R Block Inc. on Tuesday, charging that its mortgage unit discriminated against black and Latino borrowers and escalated a crisis over property foreclosures in the state. The lawsuit is the first by a U.S. state to accuse a subprime-mortgage lender of civil rights violations following a wave of foreclosures of homes in poor, often black, neighborhoods nationwide. The complaint, filed in Suffolk Superior Court, accuses H&R's subprime-lending subsidiary, Option One Mortgage Corp, of engaging "in unfair and deceptive conduct on a broad scale."

According to Massachusetts Attorney General Martha Coakley in the lawsuit, Option One and its corporate parent, H & R Block, allegedly marketed loans with layers of risky features, including:

1. 100% Financing,
2. 2/28 Loans with “Teaser Rates”,
3. “Stated Income,” “No-Doc” or “Low-Doc” Loans,
4. Substantial Prepayment Penalties,
5. Lucrative Broker Incentives to Sell Expensive Subprime Loans.

For more, see Mass. sues H&R Block over mortgages to minorities.

From the Massachusetts Attorney General's Office:

• Lawsuit - Commonwealth of Massachusetts v. H&R Block, Inc., et al.,
• Press Release - Attorney General Martha Coakley Files Lawsuit Against National Mortgage Lender Option One and Parent H&R Block for Deceptive and Discriminatory Lending Practices.

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NAACP Files Subprime Lending Suit; Seeks Class Action Status

The Associated Press reports:

• "The NAACP sued a dozen mortgage lenders Wednesday, claiming the companies discriminated against blacks by steering them into higher-interest subprime loans while giving more-favorable loan terms to white borrowers. The lawsuit, which seeks class-action status, was filed in U.S. District Court in Los Angeles. It demands a court order barring the lenders from discriminating against blacks and compelling them to comply with fair-housing and credit laws. Among the defendants named in the suit are Ameriquest Mortgage Co., Citigroup Inc., HSBC Finance Corp. and Washington Mutual Inc."

A similar suit is currently being litigated in Cleveland, Ohio (see Cleveland Fair Housing Lawyer Files Predatory Lending Class Action Lawsuit).

For more on the NAACP lawsuit, see Mortgage lenders discriminated against blacks, NAACP suit alleges.

For a copy of the lawsuit, see NAACP vs. Ameriquest Mortgage Corporation, et al., made available online courtesy of the NAACP.

For the NAACP press release, see NAACP Files Landmark Lawsuit Against Major Home Mortgage Companies For Discriminatory Lending.

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Brooklyn Federal Judge Allows Alleged Race Based Predatory Lending Suit To Go Forward

(original post 8-24-07)
Law.com reports:

• "A series of federal lawsuits filed by eight black first-time homebuyers alleging that New York's United Homes targeted minorities as part of a conspiracy to sell over-valued, broken-down homes financed with predatory loans will go forward following a federal judge's rejection of the defendants' motions to dismiss."

• "As summarized by [Federal District Court Judge Raymond J.] Dearie, "Plaintiffs claim that defendants were part of a fraudulent property-flipping scheme. They allege that United Homes and its affiliated companies ... bought damaged properties at foreclosure auctions or estate sales[,] performed some cosmetic repairs and, shortly thereafter, sold the properties, often at double the purchase price." The buyers claimed that United Homes conspired with appraisers, mortgage lenders and lawyers "who facilitated the sales by preparing significantly overvalued appraisals and originating loans and mortgages that were correspondingly inflated." They claimed violations of the Fair Housing Act and other anti-discrimination laws, as well as a number of state-law violations."

Representing the plaintiff are the law firms Scarola Ellis LLP, of New York City, South Brooklyn Legal Services - Brooklyn, NY, and AARP Foundation Litigation, Washington, D.C.

For more, see Bias Claims Proceed Against Seller of 'Damaged' Homes.

For copy of lawsuit, see Barkley vs. United Homes, et al.

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Illinois AG Slaps Subpoenas On Countrywide, Wells Fargo In Probe Into Race Bias In Lending Practices

The Wall Street Journal reports:

• Illinois's attorney general issued subpoenas yesterday to units of Countrywide Financial Corp. and Wells Fargo & Co., for an investigation into whether lenders have improperly steered minority borrowers into high-cost or inappropriate loans. The subpoena joins a long list of investigations by state and federal officials examining the business practices of the nation's mortgage lenders. Critics say such companies played a major role in the housing and mortgage crisis, which has led to record levels of home foreclosures.

***

• In Illinois, Attorney General Lisa Madigan is trying to determine whether Countrywide, the nation's largest mortgage lender, and Wells Fargo, the second-largest lender, put black and Latino borrowers in subprime or other high-cost loans when they could have qualified for a lower-cost loan.

• If the subpoenas find evidence of discriminatory lending practices, Ms. Madigan may push lenders to more aggressively modify loans to minority borrowers in financial distress so they can stay in their homes, or seek other monetary remedies in addition to changes in how loans are made, said Deborah Hagan, chief of the Illinois Attorney General's Consumer Protection Division. The investigation might be extended to other lenders, she added.

For more, see Illinois Probes Mortgage Firms (State Asks Whether Minority Borrowers Were Bias Victims) (subscription required; if no subscription, try here, then click link for story, then "refresh" browser if needed).

For Illinois AG News Release, see African American and Latino Homeowners May Have Been Steered to High-Cost Loans.

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Memphis-Area Victims Of High Cost Home Improvement Loans Reach Legal Settlement

In Memphis, Tennessee, Memphis Commercial Appeal reports on a story on Equity Title, a now-defunct local title & escrow company that reportedly specialized in closing high-fee, high-interest mortgages, most marketed to the African-American community. The company, in which a local law firm reportedly owned an indirect 50% interest in it, and a number of alleged predatory lenders became the targets of lawsuits claiming unfair practices. An excerpt from the story:

• Memphis Area Legal Services, representing 17 Memphians against Equity Title and a host of other alleged predatory lenders, alleged in federal court that Equity Title deceived loan applicants by piling on charges and backdating closing documents, among other claims.

***

• The last of the plaintiffs settled their claims out of court in June. Hawkins and the others received a settlement of $1.3 million in money damages and $1.7 million in mortgage restructuring. As a result of that lawsuit and others, Equity Title has gone out of business.

For more, see Predatory Lending: Boom and Bust (Clients fought back over subprime loans; Firm targeted high-cost notes to black borrowers).

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HSBC Accused Of Racial Bias In Subprime Lending Practices; Class Action Status Sought

Reuters reports:

• HSBC Finance has been accused in a federal lawsuit of using a subprime lending unit [Decision One] to unfairly target U.S. blacks for extra mortgage fees and charges not paid by white borrowers. [...] Her lawsuit claims HSBC and Decision One use a discretionary pricing policy that has a widespread discriminatory impact on black borrowers.

[...]

• [The] lawsuit, filed in U.S. District Court in Boston, seeks class-action status against HSBC Finance and Decision One, which are part of London-based banking giant HSBC Holdings Plc. The lawsuit said tens of thousands of people could be in the purported class.

[...]

• University of Massachusetts economist Jim Campen's study of 2005 lending activity in Massachusetts showed that a number of lenders, including Decision One, were more likely to provide high-cost loans to blacks and Hispanics than whites.

• He said the subprime mortgage market continues to resemble a used car lot, with the selling price and other charges often negotiated individually and salespeople often having financial incentives to obtain the highest price possible.

Among those representing the plaintiff is attorney Gary Klein, with Roddy Klein & Ryan of Boston, Massachusetts. For more, see HSBC Subprime Unit Accused of Overcharging Blacks.

For a copy of the lawsuit, see Allen vs. Decision One Mortgage Company, LLC, et al.

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More Discriminatory Predatory Lending Suits Possible, Says Baltimore City Solicitor

In Baltimore, Maryland, The Daily Record reports:

• A Fair Housing Act lawsuit filed by the city of Baltimore against lender Wells Fargo & Co. could be the first of its kind, but it may not be the last. City Solicitor George A. Nilson said Tuesday that at least one other “significant” lender in the Baltimore market is “under evaluation” as a potential target for a similar suit, in which the city seeks to recover its own losses from foreclosures in Baltimore’s black neighborhoods. “There could be more,” Nilson said.

For more, see City could sue other lenders for Fair Housing violations (if link expires, try here).

In a related editorial, see Suspect foreclosures (an editorial by The Baltimore Sun).

To view the City's lawsuit against Wells Fargo, see Mayor and City Council of Baltimore v. Wells Fargo Bank, N.A., et al. (8.76 MB).

Representing the City Of Baltimore is the Washington, D.C. law firm Relman & Dane.

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Race Discrimination, Civil Rights Violations Alleged In Predatory Mortgage Servicing Lawsuit - Class Action Status Sought

A lawsuit filed in a New Haven, Connecticut Federal Court last week alleges that Wall Street investment banking firm Bear Stearns and its EMC Mortgage servicing unit engaged in:

• "[r]acially discriminatory practices ... in servicing near-prime and sub-prime residential home loans" and claims that "EMC and Bear Stearns intentionally sought out non-prime loans, predominanly made to Hispanics and African Americans, in order to reap profits from their predatory servicing practices."

The predatory servicing practices complained of in the suit include:

• "[t]he imposition of unwarranted fees and costs, the pyramiding of late fees, the unjustifiable force-placing of insurance, the failure to properly credit payments, the unwarranted reporting of derogatory information regarding borrowers to credit reporting agencies, and the failure to properly administer escrow accounts."

Representing the homeowners are the firms Butler Norris & Gold, Hartford, Connecticut, and James, Hoyer, Newcomer & Smiljanich PA., Tampa, Florida.

To view the lawsuit:

• go to this direct link for Rodriguez v. Bear Stearns on the PACER system (PACER registration required - 31 pages - $2.40); or


• drop me a line at HomeEquityTheft@yahoo.com (put "Rodriguez v. Bear Stearns" in the subject line) and I'll e-mail it to you.

See also, Bear Stearns Mortgage Unit Accused of Predatory Loan Servicing (Bloomberg News).
.
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More On The Boston Alleged Discrimination / Subprime Lending Lawsuit

The lawsuit filed by three African-American mortgage borrowers accusing Countrywide Home Loans Inc. of racial discrimination in a Boston Federal Court last Thursday also names as defendants Countrywide Bank (a division of Treasury Bank, N.A.), Countrywide Correspondent Lending, Full Spectrum Lending, Inc., Loans For Residential Homes Corp., and Summit Mortgage LLC.

Representing the plaintiffs is attorney Gary Klein with the Boston, Massachusetts consumer protection law firm Roddy Klein & Ryan, the Chicago, Illinois law firm Miller Law LLC, the Long Island firm of Lerach Coughlin Stoia Geller Rudman & Robbins LLP, of Melville, New York, and the Boston office of the firm Hagens Berman Sobol Shapiro LLP, based in Seattle, Washington.

For a copy of the lawsuit, see Miller, et al. vs. Countrywide, et al.

Go here, Go here and Go here for more on recent Countrywide problems with consumers.

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More On The NAACP Alleged Discrimination / Subprime Lending Lawsuit

The NAACP Federal lawsuit filed last Wednesday in an effort to stop those lenders from engaging in what it calls "systematic, institutionalized racism in making home mortgage loans" specifically names the following lenders; Ameriquest Mortgage Company, Fremont Investment & Loan, Option One Mortgage Corporation, WMC Mortgage Corporation, Long Beach Mortgage Company, Citigroup, Inc., BNC Mortgage, Inc., Accredited Home Lenders, Inc., Bear Sterns Residential Mortgage Corporation, d/b/a Encore Credit; First Franklin Financial Corporation, HSBC Finance Corporation, Washington Mutual, Inc.

For a copy of the lawsuit, see NAACP vs. Ameriquest Mortgage Corporation, et al., made available online courtesy of the NAACP.

For the NAACP press release, see NAACP Files Landmark Lawsuit Against Major Home Mortgage Companies For Discriminatory Lending.

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California Class Action Alleges City Intimidation, Harassment Of Minority Section 8 Tenants

In Antioch, California, The National Law Journal reports:

• The mortgage crisis has spawned an unusual federal class action by African-Americans in Antioch, Calif., a San Francisco suburb, alleging city intimidation and harassment of minorities who rent homes using federally subsidized Section 8 housing vouchers in an effort to force them out of the area.

***

• The real estate foreclosure crisis hit Antioch hard. In response, landlords and homeowners turned to renting homes to pay mortgages, often renting to tenants using federal rent subsidy vouchers, known as Section 8, according to [Brad] Seligman, [of The Impact Fund, a public interest law firm in Emeryville, Calif.].

• By 2006, the inability of homeowners to sell homes allowed Section 8 participants to use their benefits to move out of urban centers to the suburb 40 miles west of San Francisco and to larger homes that might otherwise sit vacant, according to the suit.

***

• The suit, brought by five African-American women who rent homes using Section 8 vouchers, alleges that the city and police focused attention on people renting homes using the vouchers. The women say police looking for Section 8 violations subjected residents to warrantless searches of their homes. Police allegedly made threats to landlords who continued to accept the vouchers and they also allegedly intimidated renters with potential loss of benefits.

For more, see Mortgage Crisis Spawns Class Action Alleging Harassment of Minorities.

To view the lawsuit, see Williams v. City of Antioch, No. C08-2301BZ (N.D. Calif.) (available online courtesy of The Impact Fund).

See also:

• San Francisco Chronicle: Blacks' suit accuses Antioch of discrimination,
• The Impact Fund: Press Release.

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Race Biased Code Enforcement Actions Used To Force Out Poor Black Tenants, "Placate Racist Constituents," "Further Political Agendas," Says Suit

In St. Paul, Minnesota, the Pioneer Press reports:

• An Eagan man who owned and managed low-income apartments in St. Paul has sued the city, alleging that officials subjected his buildings to "discriminatory and illegal" code enforcement actions designed to hurt his business and get poor black residents to move elsewhere. In the suit filed in federal court in Minneapolis on Friday, Robert McCampbell, 52, and his company, Raven Property Management, outlined what he called a "confrontational, heavy-handed approach" to low-income landlords through its so-called problem properties code enforcement. The city's actions drove McCampbell to lose money and tenants and eventually forced him into foreclosure, he claimed.

• In contrast, McCampbell alleged, the city had a "cozy" relationship with the St. Paul Public Housing Agency, subjecting it to a much lower standard of code enforcement. The housing agency runs about 4,200 federally subsidized units for low-income tenants throughout St. Paul.

***

• McCampbell cites federal housing and civil rights violations and violations of state business laws. The suit seeks compensatory damages, attorneys' fees and injunctive relief to keep the city from "continuing its wrongful conduct."

For more, see St. Paul landlord files racial-bias suit, alleging city sought to drive out low-income black renters, their landlords (It says city sought to drive out poor black tenants, their landlords).

See also Minneapolis Star Tribune: St. Paul sued on housing enforcement (An Eagan property manager alleges city leaders are trying to keep out poor tenants. An official says that's not happening).

To view the Federal lawsuit and the detailed allegations, see Complaint - McCampbell v. City of St. Paul ("Certain of defendant's officials and code enforcement officials and inspectors pursued discriminatory code enforcement operations to placate racist constituents and to further political agendas." - at paragraph 13). race bias predatory lending

City Of Fort Lauderdale Accused Of Race-Based Selective Code Enforcement Against Homeowners

In Fort Lauderdale, Florida, the South Florida Times reports:

• A controversial program that fines and forecloses on unkempt properties in poor, predominantly black neighborhoods continues to draw fire from the homeowners and their attorneys. A lawsuit filed earlier this month alleged that the city violated the constitutional right of a property owner to due process under the law.

***

• City officials have said in published reports that they are simply enforcing laws designed to improve the appearance of neighborhoods in the city. [...] Legal Aid [Service of Broward County, Inc.] and the plaintiffs in the latest lawsuit, [...] , say the city unfairly targets black homeowners. The suit argued that the city’s foreclosures for unpaid code-enforcement fines are really an effort to remove people from their homes and make way for redevelopment.

For more, see Legal Aid challenges foreclosures. race bias predatory lending