National Fair Housing Alliance and Member Agencies Allege Discrimination in Marketing and Maintenance of Foreclosed Homes in Chicago , Milwaukee and Indianapolis
CHICAGO – The National Fair Housing Alliance (NFHA), the HOPE Fair Housing Center , the South Suburban Housing Center , the Metropolitan Milwaukee Fair Housing Council and the Fair Housing Center of Central Indiana announced Tuesday a federal housing discrimination complaint against Bank of America Corporation, Bank of America, N.A., and BAC Home Loan Servicing, LP. This complaint is the result of an undercover investigation of Bank of America that found the financial giant maintains and markets foreclosed homes in White neighborhoods in a much better manner than in African-American and Latino neighborhoods in Chicago , Milwaukee and Indianapolis .
The complaint was filed with the US Department of Housing and Urban Development and is part of an amended complaint NFHA and seven member agencies filed October 10 that looks at how Bank of America has differently maintained and marketed properties in White, African-American, and Latino neighborhoods across the country.
Bank of America is one of the largest American banks that maintains and sells foreclosed properties and is one of the world’s largest financial institutions. The investigation in 13 cities of 505 f or eclosed homes owned, serviced or managed by Bank of America demonstrates that it has engaged in a systemic practice of maintaining and marketing its f or eclosed , bank-owned homes (also known as Real Estate Owned or REO properties) in a state of disrepair in communities of col or while maintaining and marketing REO properties in predominantly White communities in a far superi or manner. The investigation has evaluated Bank of America REO properties in 13 cities including Atlanta , Charleston , SC , Chicago , Dallas , Dayton , OH , Grand Rapids , MI , Indianapolis , Miami/Fort Lauderdale, Milwaukee , Oakland/Concord/Richmond, CA, Orlando , Phoenix and the Washington , DC area.
Communities of color continue to experience foreclosure rates twice that of White communities and continue to see their REO properties left to deteriorate and sit vacant.
Fifty-one percent of Bank of America-owned homes in Milwaukee ’s communities of color had more than five maintenance or marketing problems, and 87 percent did not have a “for sale” sign.
“Neighbors living near Bank of America properties in African-American and Latino neighborhoods often report having to mow the lawn of the bank-owned home or clean up trash that has spilled onto nearby properties,” said William Tisdale, President and CEO of the Metropolitan Milwaukee Fair Housing Council. “Without the intervention of these responsible neighbors, we can only venture to guess how much worse the bank-owned homes would look. Bank of America-owned homes are not only eyesores, but they are health and safety hazards for neighboring families and young children. Through these, and other numerous examples of inaction and neglect, Bank of America has played a major role in destabilizing our neighborhoods.”
“Good neighbors are considerate, they take care of their yards, pick up their trash and care for their neighborhoods,” said Shanna L. Smith, President and CEO of the National Fair Housing Alliance . “Bank of America is not a good neighbor in communities of color. Instead, one of the nation’s largest holders of foreclosed homes is busy making excuses and passing the buck when it comes to taking responsibility for the homes it owns or services. In many White neighborhoods, Bank of America’s foreclosed properties fit in with most other homes for sale on the block, with manicured lawns and “for sale” signs. African-American and Latino neighborhoods deserve equal treatment.”
NFHA and its member agencies are represented by Joseph M. Sellers and Peter Romer-Friedman of Cohen Milstein Sellers & Toll PLLC.
The National Fair Housing Alliance and four of its member organizations – HOPE Fair Housing Center in Wheaton, IL; South Suburban Housing Center in Homewood, IL; Metropolitan Milwaukee Fair Housing Council in Milwaukee, WI and the Fair Housing Center of Central Indiana in Indianapolis – evaluated the maintenance and marketing of REO properties f or the existence of 39 different types of maintenance or marketing deficiencies , such as broken windows and do or s , water damage , overgrown lawns , no “f or sale” sign , trash on the property , and other problems.
Without a “f or sale” sign, f or example, potential homebuyers would simply not know the property is available. Also, if there are unauth or ized occupants or storm damage, neighb or s have no one to call. With a “f or sale” sign, neighb or s can call a real estate agent to rep or t these kinds of problems. In Indianapolis, 100 percent of Bank of America REO properties in communities of color were missing a “for sale” sign as well as 79 percent in Chicago and 87 percent in Milwaukee.
Trash on a property is not only an eyesore for neighbors, but it makes a home unappealing to visitors and can be a potential health and safety hazard. Regular maintenance would correct this problem, but in Indianapolis 71 percent of all Bank of America REO properties in communities of color had substantial amounts of trash as well as 52 percent in Chicago and 33 percent in Milwaukee .
Broken locks or doors are an invitation to vagrants and possible criminal activity. Vagrants stay away from properties that are secured and regularly maintained and visited by responsible owners. In Indianapolis, 57 percent of properties in communities of color had broken doors or locks, while in Chicago the figure hit 55 percent and in Milwaukee 41 percent of properties had that deficiency.
Additional detailed statistics and photos are available at www.nationalfairhousing.org.
NFHA will continue its investigation into the practices of REO maintenance and marketing in the nation’s banking system. In April, NFHA issued a report on the findings of its nationwide REO investigation , The Banks Are Back, Our Neighborhoods Are Not: Discrimination in the Maintenance and Marketing of REO Properties. The report offers disturbing evidence that the same banks that peddled unsustainable loans to communities of col or and triggered the current f or eclosure crisis are now exacerbating damage to those communities. It details the results of the evaluation of more than 1 , 000 REO properties nationwide.
NFHA filed HUD administrative complaints against Wells Fargo and U.S. Bancorp in April 2012. Both of these complaints are pending while HUD investigates these serious and pervasive allegations of discrimination.
The Fair Housing Act makes it illegal to discriminate based on race, color, national origin, religion, sex, disability or familial status, as well as the race or national origin of residents of a neighborhood. This law applies to housing and housing-related activities, which include the maintenance, appraisal, listing, marketing and selling of homes.
To read the most recent HUD administrative complaint against Bank of America and to view today’s news conference presentation , please go to www.nationalfairhousing.org.