Fairway, accused of redlining in Alabama, agrees to settle for $1.9M
Briefly

The Consumer Financial Protection Bureau and the U.S. Department of Justice allege that Fairway Independent Mortgage Corp. engaged in redlining practices, discouraging mortgage applications from residents in majority-Black neighborhoods of Birmingham, Alabama. As a result, Fairway will face a $1.9 million civil penalty and invest $7 million into a home loan subsidy program aimed at these communities. This agreement reflects ongoing concerns about discrimination in mortgage lending, illustrating disparities in approval rates for residents in predominantly Black areas compared to their peers.
Between 2018 and 2022, Fairway issued applications for only 3.77% of loans from the majority-Black areas in Birmingham, significantly lower than the 12.2% approval rate for other lenders. Moreover, in neighborhoods with Black populations exceeding 80%, Fairway's loan approval rate was less than one-eighth of that of competing lenders, presenting stark evidence of lending discrimination that needs addressing.
The agreement with the CFPB and DOJ requires Fairway to not only pay a hefty civil fine but also to commit substantial resources to improve lending access in historically underserved communities. Fairway neither admits nor denies the allegations, signaling a common tactic among corporations facing regulatory scrutiny, where they seek to mitigate penalties without outright acknowledging wrongdoing.
Read at www.housingwire.com
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