Emigrant Bank's predatory lending loss upheld by Supreme Court

"Through the persistence of our Plaintiffs and their bravery to stand up against a major New York lender for what is right, justice is finally being served, said Tara Ramchandani, co-managing partner at Relman Colfax, in a press release. While we are saddened that some of the victims fighting for fairness are no longer with us after this nearly fifteen-year-long David vs. Goliath battle, we honor their legacy, knowing they had a critical part to play in ensuring injustice was exposed and history has been made."

"Beyond delivering justice to the eight homeowners targeted by Emigrant, the decision marks a major victory against predatory lending and a clear warning to financial institutions. It establishes critical precedents for proving systemic discrimination under the Equal Credit Opportunity Act, the Fair Housing Act, and the New York City Human Rights Law, including the use of equitable tolling to extend civil rights statutes of limitation."

Loans carried an automatic 18% default interest rate triggered after a single missed payment, sharply increasing monthly obligations and pushing many borrowers toward foreclosure or forced sales. Jurors found Emigrant Bank disproportionately marketed those loans to Black and Latino homeowners in New York City. The 2016 jury verdict was the first to hold a bank liable for reverse redlining tied to mortgage practices preceding the 2008 financial crisis. Legal Services NYC and Relman Colfax PLLC represented the homeowners. The ruling establishes precedents for proving systemic discrimination under the Equal Credit Opportunity Act, the Fair Housing Act, and the New York City Human Rights Law, and for applying equitable tolling to civil rights statutes of limitation. Emigrant did not respond to HousingWire.

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