Fair Housing Act

Question 1

What is the Fair Housing Act?

Answer 1

Part of the Civil Rights Act of 1968 and prohibits discrimination in the sale or rental of a dwelling on the basis of
* race
* color
* religion
* sex
* handicap
* familial status
* national origin

(AKA Protected Classes)

Overseen by HUD

Question 2

What are discriminatory activities?

Answer 2

A person, when dealing with a member of a protected class,

• Refuses to sell or rent a dwelling or to negotiate the sale or rental of a dwelling
• Offers different terms or conditions in the sale or rental of a dwelling
• Represents to an individual that a dwelling is not available when, in fact, it is
• Charges different rates and fees or offers different terms in a mortgage loan transaction

Question 3

On what basis may a lender reject an application?

Answer 3

• Credit history
• Employment history
• Earning capability factors
• If it it deemed to be fraudulent.

Question 4

Define: Redlining

Answer 4

The practice of denying services (e.g., financial services, housing options, medical services) in certain neighborhoods based on racial and/or ethnic factors

Question 5

Define: Reverse redlining

Answer 5

• Targeting populations or neighborhoods based on racial and/or ethnic factors to market expensive, risky loan products to vulnerable consumers.
• Predatory lenders will attempt to offer costly and financially risky loans to potential borrowers who may be older, have a poor grasp of English, or have less access to the education necessary to understand what is being offered.

Question 6

Define: Steering

Answer 6

Real estate and mortgage professionals preserve and encourage established patterns of racial segregation in housing by steering members of certain ethnic or racial groups to buildings and neighborhoods occupied primarily by members of the same group – and away from areas occupied by members of other groups.

Question 7

Define: Discouragement

Answer 7

Eligible borrowers are discouraged from attempting to purchase homes or obtain mortgage loans that the lender deems “not suitable” for the borrower based on personal characteristics.

Question 8

Define: Blockbusting

Answer 8

The act of, for profit, actually or attempting to induce a person to sell or rent a dwelling by making representations about the prospective or actual entry into the area of persons of a particular protected group.