California Black, Latina real estate couple lowballed $ 250,000 in home appraisal
Ronald who is black and Dominique who is Puerto Rican think they received the same treatment and decided to sit down with ABC7 Race and Culture reporter Julian Glover to tell their story.
“We were in the process of refinancing. The appraiser came out and we were shocked when we saw that our home was worth $ 254,000 less than the appraisal we got months earlier, ”said Ronald Curtis.
The family’s lender, Rocket Mortgage, owned by Quicken Loans, ordered the appraisal through an independent appraisal management company (AMC) in December 2020.
The home was valued at $ 900,000, but a few months earlier in April the home was valued at $ 1,154,000 in a valuation also ordered by the lender: a difference of a quarter of a million dollars.
Meanwhile, house prices have risen and interest rates have fallen.
But the Curtis family were uniquely positioned to conduct their own investigation, surveying comparable homes to find something was wrong.
“I have been a real estate agent for over 10 years and am currently a Chartered Real Estate Broker,” said Mr. Curtis.
“I’ve been training to be an evaluator for about two and a half years now. I have to take my test pretty soon, ”Ms. Curtis said.
After doing some research, Ronald knew there was a bigger problem involved.
“Someone doesn’t have to say that the reason they did it is because we were black or Puerto Rican, or people of color. But absolutely, that’s the reason why,” Curtis said. .
The Curtis family immediately pulled the reports of the comparable homes that the appraiser used in their MLS (Multiple Listing Services) report to which they have access as licensed real estate professionals.
The family showed ABC7’s Julian Glover photos of the current state of the homes, ravaged by boarded up windows, a collapsed garage and bricks lining a roof to hold the shingles in place.
“He was just deliberately looking for a property that was worth his price so that he could lower our value,” Curtis said.
Those same photos were also attached to the nearly 60-page complaint the family filed with the California Board of Real Estate.
The investigation is ongoing.
Meanwhile, interest rates have risen, meaning the family missed the opportunity to save thousands of dollars a year on their mortgage by refinancing.
ABC7 contacted Quicken Loans and received the following statement:
Quicken Loans truly regrets the frustration Mr. Curtis and his family have experienced with their home loan. Under federal law, lenders are required to work with independent appraisal management companies who then outsource the work to state-licensed professionals to perform home appraisals as part of the mortgage process. The intention of the law is to determine the value of the home without any input or bias from the lender – or anyone else – involved in the transaction.
We contacted Mr. Curtis for permission to order a new appraisal from a second certified appraiser, at our expense as an accommodation for our client, in order to obtain additional valuable advice. Quicken Loans values equity and fair loans and we are ready to assist Mr. Curtis in obtaining financing for his home if the second appraisal is sufficient to support the loan amount.
However, the Curtis family provided a voicemail message showing that a representative for Quicken Loans did not offer a second review until the day after ABC7 News contacted the company for comment.
Out of frustration with the company, the Curtis family declined the second proposed assessment on Monday, and in a follow-up statement, Quicken Loans informed ABC7 News that the company now considers the matter closed.
Given the current monthly mortgage rate, the Curtis family informed ABC7 News that they had signed a lease to rent a house and would likely sell their current property.
“We know the implications of what that means. It doesn’t mean it affects us for a month or two and then it goes away. These are things that affect us for generations,” Curtis said.
Discrimination in the housing market is systemic and detrimental to marginalized people with consequences borne across generations.
A 2018 report from the Brookings Institution On the “asset devaluation in black neighborhoods” seen in most of the country’s metropolitan areas, homes in predominantly black neighborhoods were valued significantly less than homes in neighborhoods where there are virtually no black residents.
The study found that differences in homes and neighborhood quality do not explain the devaluation of homes in black neighborhoods.
The study found that homes in black neighborhoods in the Bay Area are valued 27% less than homes of similar quality in white neighborhoods: a difference of $ 164,000 on average, among the nation’s worst differences. .
Looking at the national chart, homes in black neighborhoods with similar amenities are worth 23% less, $ 48,000 per home on average.
“We shouldn’t have to eliminate darkness from our homes to get a fair stir in society,” said Andre M. Perry, senior researcher at the Brookings Institution.
Perry wrote the Brookings Institution Study on Devaluation of Black Houses and wrote the book “Know your Price: Valuing Black Lives and Property in America’s Black Cities”.
As the Austin story went viral, several Twitter users tagged ABC7’s Julian Glover in Perry’s work.
“Whether it’s valuations, whether it’s real estate agent behavior, lending practices, all of these things in housing markets have an impact on prices, and it’s clear that something is happening today that is reducing the price of black houses, ”Perry said.
“That’s about $ 156 billion in lost capital across the country. That would have paid for over 8 million college degrees, based on the average amount of a four-year public institution. It would have replaced the pipes at Flint. , Michigan, 3,000 times over — That’s a lot, ”he said.
These losses often go unnoticed and go unreported.
That’s why nonprofit advocacy groups like Fair Housing Advocates of Northern California (FHANC) encourage families to file formal complaints.
FHANC represents victims of discrimination in housing.
In California, a person discriminated against on the basis of race, religion, sex, sexual orientation, disability or age – among other protected classes – can file a complaint.
Executive Director Caroline Peattie said she was stunned when she heard about Austin’s story.
“People can file an administrative complaint of discrimination with the Department of Housing and Urban Development (HUD) and the California Department of Fair Employment and Housing,” Peattie said.
If you want to file a complaint, Click here.
She also pointed out that families or people facing housing discrimination have one year to file a complaint and two years to file a lawsuit in California.
There are remedies in both situations involving rentals and real estate purchases.
Peattie said more often than not the action leads to settlements or reprimands on behalf of the negligent institution.
The process, however, can take months, or even years, to resolve.
Peattie said victims have a better chance if they are represented.
“Racism must be fought and corrected in ways that will be remembered,” she said.
The Austin are now considering filing a formal complaint.
Tate Austin is happy that sharing her family story has encouraged others to come forward.
“With people standing up and starting to fight for social justice, I feel like the world is ready to have this conversation,” said Tenisha Tate Austin.
“People talk and they stand up and let people know that it’s not just a one-time thing. It’s a systemic issue that needs to be changed,” Austin said.
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