The Administration’s “Disparate” Attacks on the Fair Housing Act Will Go Through Unscathed

by Isaac Benmergui, Esq on January 2, 2014

Just so we’re clear on this, that’s not exactly good news for countless mortgage lenders, real estate owners, brokers and many others associated with the real estate industry. They were essentially counting on the United States Supreme Court taking action and ruling on the issue, but it seems they won’t have that chance at the moment.

Why is this such a big deal? The White House and Justice Department, in essence, have supported an interpretation of homethe FHA, allowing for not only prohibition of intentional minority discrimination, but also discriminatory effects of those policies, even when there wasn’t any intent to do so. That simply means that even if a lender or broker didn’t intend to cause some kind of discrimination in a real estate transaction, that buyer can file a lawsuit claiming discrimination and most likely win.

This is an issue costing mortgage lenders literally millions, worrying rental real estate owners as well on the possibility of not having much choice over whose offers they will take. Think of it as a sort of affirmative action for real estate on steroids. Authorities in the housing market will absolutely have to take offers from minorities….or else!

Thankfully, though, the U.S. Supreme Court did receive such a lawsuit with the opportunity to review the interpretation and statutory construction of the Fair Housing Act. Sadly, though, the Department of Justice requested that the Court reject it. Very interesting….

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