Rocket Reacts To Charge Of Housing Discrimination By HUD
Leaders at Rocket Companies are speaking out after being charged with discrimination by the U.S. Department of Housing and Urban Development.
According to officials at HUD, a Black homeowner in Denver who was refinancing her property alleges that appraiser Maksym Mykhailyna with Maverick Appraisal Group and the appraisal management company Solidifi undervalued her property due to her race.
Mykhailyna settled on $640,000 for the woman’s duplex even though it had been valued at $750,000 in 2018 and $860,000 in 2020. He also used “unsupportable methodological choices,” such as comparing the property to those in different neighborhoods with bigger Black populations, according to officials.
Solidifi and Rocket Mortgage failed to correct the report despite concerns, HUD says, and when the homeowner alerted Rocket Mortgage that she suspected bias, the company would only proceed with the loan application based on the allegedly discriminatory appraisal amount. The homeowner was ultimately denied a loan.
A spokesperson at Rocket Companies said on Monday that HUD is trying to “score headlines” by naming them in their case.
“Under federal law, mortgage lenders are required to work at arm’s length during the appraisal process, partnering with independent appraisal management companies who assign the work to state-licensed professional appraisers. The law’s intent is to determine the home’s value without any input or bias from the lender or any other party with interest in the transaction,” the spokesperson said in a statement.
“For that reason (and more), our company is clearly a misplaced target used simply to score headlines because of its brand and position in the industry. We look forward to bringing the facts of this case to court to set the record straight. Until then, we will continue offering affordable options and championing other equitable initiatives to make the dream of homeownership accessible to all.”
The woman was a customer of Rocket Mortgage at the time of the 2018 and 2020 appraisals, according to the charge.
HUD says Mykhailyna, Solidifi, and Rocket Mortgage violated the Fair Housing Act, which prohibits discrimination in appraisals.
“Homeownership is crucial to build both generational wealth and housing stability for Black and Brown families,” said Diane M. Shelley, HUD’s Principal Deputy Assistant Secretary for Fair Housing and Equal Opportunity.
“HUD will continue to vigorously enforce the Fair Housing Act against those who seek to limit the financial returns associated with homeownership because of race or any other protected characteristic.”
A United States Administrative Law Judge will hear HUD’s charge unless any of the accused ask for the case to be heard in federal district court.
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