Wednesday, October 18, 2017
NAACP Sues 11 Mortgage Lenders, Alleging Discrimination
By Jennifer English, CNS
Published July 19, 2007

CNS—The NAACP has filed suit in Los Angeles against 11 mortgage lenders, including Ameriquest, Washington Mutual and Citigroup, accusing them of offering Black borrowers subprime loans with worse rates than other applicants.

The federal discrimination suit, which seeks class-action status, cites a 2006 study by the Center for Responsible Lending, which found that when income and credit risk were equal, Blacks were 31 to 34 percent more likely than Whites to get higher-rate, more expensive subprime loans.

Recently, the Federal Reserve Board also concluded blacks were more likely to pay higher prices for mortgages than whites, according to the suit.

The NAACP alleges the lenders are violating the Fair Housing, Equal Credit Opportunity and Civil Rights acts.

“These statistical disparities are not mere happenstance, but instead result from a systematic and predatory targeting of African-Americans,” the suit states.

In addition to Ameriquest Mortgage Co., Washington Mutual Inc. and its subprime subsidiary, Long Beach Mortgage Co., and Citigroup Inc., the named defendants are HSBC Finance Corp.; Bear Sterns Residential Mortgage Corp.; First Franklin Financial Corp.; Lehman Bros. Holdings subsidiary BNC Mortgage Inc.; Accredited Home Lenders Inc.; H&R Block subsidiary Option One Mortgage Corp.; General Electric-owned WMC Mortgage Corp.; and Fremont General Corp.’s Fremont Investment & Loan.

Citigroup and Fremont General representatives declined to comment. Representatives for the other lenders could not be immediately reached for comment on the suit, which seeks a court order forcing them to change their practices.

An attorney representing the National Association for the Advancement of Colored People, Brian Kabateck, called it the first discrimination suit to be brought against such a large number of mortgage lenders.

Kabateck alleged that discriminatory lending practices against African- Americans are found “at every income level and in every part of the country.”

“These lenders are not only breaking the law, they are reaping a financial windfall from their abhorrent behavior,” he said, by charging higher interest rates and loan charges that can total tens of thousands of dollars over the life of loans.

The suit does not specifically seek a financial award.

Categories: National

Get the Los Angeles Sentinel App!


LA Sentinel
in your pocket:

Taste of Soul Sponsors

© 2017 Los Angeles Sentinel All Rights Reserved • A Bakewell Media Publication

Contact UsAboutMedia KitCorrections & Misprints

Terms of ServicePrivacy Policy

LA Watts TimesTaste of Soul

Close / I'm already on the list

Subscribe Today!

Don't be limited anymore! Subscribe Now »

** Existing subscribers, please Login / Register for Digital »

Subscribe to The Los Angeles Sentinel for only $5.99 $3.99 per month, with 1 month free!

Relax in comfort each week as you read the printed newspaper on your own time, delivered weekly to your home or office. This subscription also includes UNLIMITED DIGITAL ACCESS for all of your devices. Includes FREE shipping! One easy payment of $3.99/month gets you:

Subscribe Now »

Enter For a Chance to Win!

HYUNDAI "Better" Contest at Taste of Soul Los Angeles