Racist housing policies have made it harder for black families to own homes and accumulate wealth.
According to court documents filed Monday, a pair of professors from the University of Baltimore filed a lawsuit against a real estate appraisal and online mortgage lender, accusing them of valuing their home at a lower price due to their race.
Is it possible that our presence and life in our home bring the property value down? Nathan said it was an absolute gut punch.
In order to take advantage of low-interest rates last year, the Motts bought a four-bedroom house that they thought was worth more than they paid for it. They had already spent over $30,000 on renovations and home prices were going up.
The initial appraisal came back with a value of $472,000.
A white friend posed as the owner of the property in order to make it seem like he was the one who owned it. There were framed photographs around the house that appeared to show a white family living there.
The house was worth more than half a million dollars.
According to the professors, the owners of 20/20 Valuations and loanDepot.com are in violation of the Fair Housing Act and other anti- discrimination laws.
The first appraisal was done by the man. He is accused of undervaluing the home because it is located next to a black census block and also in an affluent, mostly white neighborhood.
Even though one of the company's loan officers assured the couple there would likely be no problems, they were denied the application. The employee said the estimated value was conservative. His estimate was around $75,000 less than that.
According to court documents, the husband and wife and their three children were present at the time of the tour. A "Black Panther" movie poster can be seen around the space, as a lecturer on Literature and Africana studies, and as a black author.
A letter was written by an expert in historically racist housing policies. The loanDepot.com officer stopped responding to the calls.
The couple applied to another loan lender.
They whitewashed the house before the appraisal, removing the indicia that a Black family lived there, such as family photos and their children's drawings of Black people, and replacing them with items borrowed from white friends. A white colleague was enlisted to be with the appraiser when he stayed away from the house.
The value of the house went up. If they hadn't encountered any problems with their initial home valuation, the interest rates would have been lower for them.
According to the complaint, a Black family did not really belong in Homeland, which is located north of Baltimore and around 80% white.
A black couple in California conducted a similar experiment after their home was initially appraised at $1 million. The property was worth more than one million dollars after being whitewashed.
According to The New York Times, the couple, Paul Austin and Tenisha Tate-Austin, will be going into mediation next month.
Black families have been subject to racist housing policies that make it harder for them to own their homes and accumulate wealth due to systemic racism.
The Department of Justice made an announcement last fall. The statement of interest in the Austins case was filed earlier this year and stated that discrimination in appraisals is a high priority for the federal government.
The article was first published on HuffPost.
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