Discrimination In Loans Under the Fair Housing Act
In Hargraves v. Capital City Mortgage Corp., 140 F. Supp. 2d 7 (D. D.C. 2000), the District Court determined housing discrimination in the form of reverse redlining is prohibited under Section 3605(a) of the Fair Housing Act (FHA).
In light of the shared objectives of the FHA and the Act, to ban housing discrimination, and the identical language in both statutes prohibiting discrimination in real estate-related transactions, we agree with the Commission that the Act provides a cause of action for discrimination based on reverse redlining.
Further, given the similarity in statutory language addressing discrimination in loans, the loan provisions of the Act provide a cause of action for reverse redlining.
The Act's loan provisions prohibit discrimination in the terms and conditions of loans for housing construction, rehabilitation, repair and maintenance.
Correspondingly, Section 3605(b) of the FHA defines a "residential real estate-related transaction" in relevant part as the "making or purchasing of loans or providing other financial assistance . . . for purchasing, improving, repairing, or maintaining a dwelling; . . . secured by real estate." 42 U.S.C. 3605 (b).