Municipalities File Fair Lending Lawsuits
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- A number of municipalities recently have filed fair lending lawsuits under the Fair Housing Act, alleging that discrimination against African-Americans and Hispanics in mortgage lending harmed the municipality.
- The municipalities claim that discriminatory lending tactics increased the incidence of foreclosures in certain neighborhoods, leading to reduced property tax revenues and a greater need to provide costly municipal services to vacant homes.
- These lawsuits, which seek to expand liability under the Fair Housing Act in unprecedented ways, warrant monitoring for their potential implications for fair lending compliance programs.