Housing suit targets Bank of America
Disparities in upkeep of foreclosed homes claimed in filing.
Housing activists, including a Palm Beach County group, have accused Bank of America of allowing foreclosed houses in black and Hispanic neighborhoods to fall into disrepair even as it stu- diously maintains bank-owned homes in white areas.
The nonprofit National Fair Housing Alliance on Tuesday filed suit accusing one of the nation’s largest financial institutions of “systematic” discrimination. The Fair Housing Center of the Greater Palm Beaches is among the 20-plus plaintiffs in the federal suit.
“Across the board, properties located in communities of color were much more likely to have numerous objective routine maintenance and marketing deficiencies than the Bank of America-owned homes located in white areas,” the suit says.
The Fair Housing Center of the Greater Palm Beaches photographed foreclosed properties held by Bank of America and found striking differences. A West Palm Beach house in a non-white neighborhood sported torn screens, a blue tarp on the roof and green pool water. A suburban Boynton Beach home in a mostly white neighborhood, by contrast, looked pristine.
Bank of America disputed the activists’ allegations.
“The allegations are without merit,” the company said in a statement. “We apply uniform practices to the management and marketing of vacant bank-owned properties across the U.S., regardless of their location.”
In February, a group of nonprofits headed by the National Fair Housing Alliance lodged a similar suit against lender Deutsche Bank and loan servicer Ocwen Financial.
In the latest suit, fair housing activists said they visited nearly 1,700 Bank of America properties nationwide and took more than 35,000 photographs documenting the condition of the homes.
The organization said its survey of Bank of America foreclosures found that fully 45 percent of properties in minority neighborhoods had 10 or more maintenance or marketing defects, while only 11 percent of the properties in mostly white neighborhoods had 10 or more problems.
Housing activists say neglected bank-owned properties create a cycle of falling values: Dilapidated houses project no curb appeal to potential buyers and therefore elicit few offers. And properties in poor repair invite vandalism and squatters.
According to the National Fair Housing Alliance’s suit, minority neighborhoods are hit especially hard by foreclosures. Homes in black and Hispanic neighborhoods that are near foreclosed properties see their values plummet by 16 percent, the suit said, compared to an 8.8 percent drop for all homes near foreclosures.
The U.S. housing market has experienced a persistent wealth gap. In the first quarter of 2018, the homeownership rate for white Americans was 72 percent, compared to just 48 percent for Hispanics and 42 for blacks, according to the U.S. Census Bureau.
The suit names as defendants Bank of America and Safeguard Properties Management, which oversees Bank of America’s foreclosures.