The National Fair Housing Alliance and 20 local fair housing groups have filed a lawsuit in federal court against Fannie Mae over its maintenance and marketing of foreclosure properties.
The lawsuit claims that Fannie Mae has engaged in housing discrimination by failing to maintain REO properties in Latino and African-American neighborhoods as well as it does in white neighborhoods, according to a news release Monday.
This is not the first time that NFHA has alleged racial discrimination with regards to Fannie Mae's handling of foreclosure properties. In May 2015, the organization said
The fair housing group has researched the issue since 2009 and claims to have found significant disparities between Fannie Mae's properties in African-American and Latino neighborhoods and the foreclosures in white neighborhoods. For instance, NFHA's research allegedly found that 41.5% of the REO properties in neighborhoods of color had a broken, boarded, or unsecured window, versus just 19.1% of the REO properties in white neighborhoods.
NFHA said that it has presented its findings to Fannie Mae multiple times to little or no avail.
"Fannie Mae executes its mission in predominantly white neighborhoods, but certainly the evidence in the complaint and the photographs illustrates that its foreclosures in middle- and working-class neighborhoods of color are not maintained as 'best in class' and they are not even close to 'market-ready,'" Shanna Smith, president and CEO of NFHA, said in the release.
Fannie Mae roundly rejected the allegations made by NFHA in a statement.
"We have heard NFHA's concerns, and strongly disagree with these allegations," the GSE said in the statement. "Our REO maintenance standards are designed to ensure that all properties are tended to and treated equally."
Fannie Mae also noted that it works to improve its processes related to REO maintenance, including the approved use of clear boarding nationally and enhanced guidance for field service vendors.
"Through these actions we have demonstrated our continued dedication to providing quality care to all communities," Fannie Mae said. "And we remain firmly committed to continuing to provide such attention to our REO properties moving forward."
