Antidiscrimination and Real Estate

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Antidiscrimination laws cover race, gender, age, national origin, family status, religion and disability. But some laws also prevent housing discrimination based on sexual orientation, race, and gender identity. However, strict control of these issues is not consistent among all states. Even more, many people do not realize these laws are in place. Housing discrimination can make real estate transactions complicated for minorities.

Why We’re Asking:

Buying or selling your home is usually the most significant purchase in one’s lifetime. But what if your interest rate on your mortgage is higher simply because of your religion? Or what if a home seller is falsely accused of discrimination? We want to understand what legal protection home sellers and buyers can turn to. We also want to know how real estate lawyers can help flesh out such a sticky situation involving housing discrimination.

Share your thoughts below:

How do you Guard Against Discrimination in Real Estate?

How is discrimination in residential real estate controlled?

What protections are available for home buyers to make certain that they are being treated fairly?

How can home buyers be sure they are being treated fairly when signing a mortgage and interest rate?

How can home sellers make certain they are not violating any anti-discrimination laws?

We’re excited to help inform home buyers and sellers how to ensure that their real estate transactions are fair and unbiased.

Please post your answers in the comment field below!

6 COMMENTS

  1. Discrimination in real estate transactions can occur in several instances:the advertising of property, the financing options available to potential buyer, the availability of insurance for buyers, and the actual availability of real property for certain classes of individuals. Control over discrimination in these types of transactions is exerted by local, state, and federal agencies under a series of both state and federal laws. The majority of states have enacted civil rights (or human rights) legislation which generally prohibits discrimination in transactions involving “housing,” “public accommodation,” “real property,” and/or “credit.” As a broad rule, home sales, real property leases, mortgages, and insurance for homes all fall within the ambit of transactions which are protected by state human rights statutes. In addition, in 1968 Congress passed Title VIII of the Civil Rights Act of 1968, commonly known as the “Fair Housing Act.” This act made it a violation of federal law to discriminate in the “sale, rental, and financing of dwellings” and “other housing-related transactions” based upon what has been held to be “protected classes”: Race, color, national origin, religion, sex, familial status, and handicap (disability). Home buyers who fall within one of these protected classes, and who feel they have been treated unfairly as a result, should seek assistance from their lawyer or any one of a number of sources, including local governmental legal services agencies; legal aid groups hosted by state bar associations; and their state department of civil/human rights. Affected persons can also look to remedies through the federal Office of Fair Housing and Equal Opportunity (“FHEO”), at http://www.hud.gov/offices/fheo. This office has a legal process which works with state and local agencies to investigate complaints dealing with discriminatory housing practices. Home sellers similarly should seek legal help if they are concerned that some aspect of their real estate transaction might infringe on state or federal anti-discrimination laws.

  2. In today’s challenging market it is extremely important to capitalize on
    every lead that a mortgage loan officer receives. It has never really made
    sense to me that while illegal, some lenders do discriminate against
    certain groups and limit their exposure to the marketplace. The goal of any
    successful business is to grow by leaps and bounds. At my branch we don’t
    care if you are pink with purple polka dots, if you qualify for a loan based
    on credit, income and work history we will work as hard as we possibly can
    to get you financing for your home and make sure the loan closes. In Texas
    it is absolutely imperative that as mortgage lenders we follow state rules
    and follow the strict anti-discrimination laws that have been put into
    place.

    In keeping with this practice there is a form on every mortgage application
    that must be filled out to be in compliance with the Home Mortgage
    Disclosure Act. This form requires the loan officer to note the applicants
    Race, Nationality, and Sex. This form is required so that the government
    can maintain records showing if any company is leaning too heavily on one
    specific race/sex or if they are showing an unfair bias towards a certain
    group.

  3. Today it seems hard to imagine that someone selling a house would
    give up the highest offer and take less money simply to keep someone of a
    different race or religion from living in his old neighborhood. But that’s
    exactly what happened for much of the 20th Century.

    For years, hard-working Americans were humiliated after saving to make the
    largest purchase of their lives, carefully selecting a home that meets the
    needs of their children in a neighborhood where they hoped they would have
    the best chance for success, and then learning that they could never live
    there because of their race.

    Those who were discriminated against often responded in creative ways. In
    Houston, for instance, the River Oaks neighborhood was home to the city’s
    wealthiest residents, but they wouldn’t sell to Jewish people. As a result,
    the Jewish community created the Riverside Terrace neighborhood of
    beautiful mansions.

    Congress and state legislatures recognized that this kind of discrimination
    had no place in American society, and that if we were ever going to live in
    an integrated nation, we had to allow people the opportunity to purchase
    and rent property without regard to their race or religion. This
    is vitally important, because where we live determines where our children
    go to school, how likely we are to be victims of crime, what jobs and
    public services we have access to, and our overall quality of life.

    Through the years, Congress and states have expanded upon
    anti-discrimination laws and now protect more than just race and religion.
    Today, those selling or renting housing cannot discriminate against race,
    gender, age, national origin, family status, religion, and disability. As
    you mention, in some states, sexual orientation is also protected.

    To answer your specific questions:

    1) How do you guard against discrimination in real estate/how can home
    sellers make certain they are not violating any anti-discrimination laws?

    Some sellers like to know who will be moving into their property,
    particularly if they have a sentimental attachment to it. But most sales
    today are conducted at arms-length, where the buyer and seller communicate
    through their agents and never meet. This has its advantages. First, it
    keeps people objective and helps them focus on the business end of the
    transaction. But it also helps to guard against an accusation of
    discrimination. If you’ve never met your prospective buyers, how do you
    even know their race? As an agent or attorney, you should discourage your
    client from asking irrelevant questions and keep them focused on the
    business end of the transaction.

    A seller’s objective is to get the greatest asking price possible, and if
    you’re worried about how the new owners will decorate, whether your old
    neighbors will like them, or whether they might someday sell to a
    developer, then you’re not ready to sell. While there might be rare
    exceptions for historic or other unique property, I generally advise
    clients to focus on their future–not their past. Once you sign over the
    property, the new owners can do whatever they want. Either accept that the
    property is not going to be yours anymore, or don’t sell the property.
    2) How is discrimination in residential real estate controlled?

    There are three primary enforcement mechanisms to control discrimination in
    residential real estate. First, someone who believes he has been
    discriminated against can file a private lawsuit. Second, the federal
    government investigates allegations of discrimination and enforces
    discrimination laws. Finally, most states also enforce state and local
    laws, usually through the state attorney general’s office.

    Discrimination cases are difficult to prove in part because you generally
    have to show that the reason you were unable to purchase or rent the
    property was because of one of the factors listed in a state or federal
    statute.

    3) What protections are available for home buyers to make certain that they
    are being treated fairly?

    If you believe that you are being discriminated based on your race,
    religion, gender, age, national origin, family status, or disability, you
    should contact an attorney. What kinds of discrimination might you
    encounter? You might make an offer on a house which is rejected, only to
    learn that someone else made a lower offer that was accepted. There are
    legal reasons why a seller might do this, but it raises a red flag. In
    cases like this, your realtor can be an important asset, because he or she
    will have access to sales data and other information that might shed light
    on why your offer was rejected.

    4) How can home buyers be sure they are being treated fairly when signing a
    mortgage and interest rate?

    These days, lending discrimination is more difficult than it used to be. A
    generation ago, your only option to borrow money, might have been to walk
    into a local bank, where the manager or lending officer would size you up
    and make a subjective determination about whether you were a good candidate
    to loan money to. This led to many allegations of discrimination.

    Today, however, anyone can log into a computer and apply for a loan. Banks
    can provide you with almost instant approval without ever seeing you and
    based on more objective criteria, such as your credit score. There are
    still allegations of red lining, where a bank uses your address as a factor
    for denying you a loan, but this is increasingly rare.

  4. As a lawyer in Washington, my best advice is to act quickly if you have experienced housing discrimination. Some fair housing agencies are only able to investigate cases of discrimination in the previous six months. I also advise you to write everything down. It is important to keep detailed notes about every negative action taken against you. Details include the date and time and people who were involved. It is even better if you can provide a list of witnesses with contact information. But the most important advice is to be expedient in reporting a discrimination case and hire a lawyer if you do not think the fair housing agency understands your unique case.

  5. I will answer this question, “How can home buyers be sure they are being treated fairly when signing a mortgage and interest rate?” The law states that in mortgage lending it is unlawful to refuse to make a mortgage loan based on color, race, religion, sex, familial status, handicap, or nation origin. It is also a disadvantage for a mortgage lending company to discriminate. They need the business, and if you are qualified based on credit and income, it benefits them to work with you. Mortgage lenders are also prohibited to refuse information regarding loans. Borrowers can be assured that they are receiving fair terms and conditions on a loan such as interest rates because it is unlawful to impose different terms based on discrimination. If you experience discrimination with mortgage lending, you should immediately report it to your local Fair Housing Regional Office: http://portal.hud.gov/hudportal/HUD?src=/program_offices/fair_housing_equal_opp/aboutfheo/fhhubs.

  6. I think it is important to distinguish what is not discrimination. Landlords need to be protected as well. A tenant or homebuyer can be turned down for having bad credit. Landlords should require credit reports from all applicants to ensure reliability from their tenants. Landlords also have the right to set a minimum income level to ensure affordability of the home/apartment. And finally, it is not considered discrimination for landlords to raise the rent when additional people are added to the unit, but this must be stated in the lease. Landlords and property owners have to look out for their finances/business, and ensuring that they receive appropriate compensation through credit reports and income levels is perfectly legal.

Comments are closed.