Disparate impact is a key tool in combating discrimination in lending, aids consumer protection
WASHINGTON, D.C. – June 29, 2015 – (RealEstateRama) — On June 25, 2015, the Supreme Court of the United States held that disparate impact claims are recognizable under the Fair Housing Act. In the case Texas Department of Housing and Community Affairs v. the Inclusive Communities Project, the Justices ruled 5-4 to uphold the use of disparate impact to help prove claims of housing discrimination.
Center for Responsible Lending president Mike Calhoun offered the following statement:
Today’s decision is an affirmation that our nation must continue on its long journey of eliminating racial discrimination in the housing sector – and that disparate impact is a necessary tool that will help us?advance on this journey.
Disparate impact is critical in confronting and correcting abuses in lending. We have observed, documented, and reported on disparate impact in mortgage lending, auto lending, student lending, and a suite of other financial services. We know the power that lies in responsible lending – and the opportunities that access to responsible credit can bring to households, families, and communities. We have witnessed what happens when a single community cannot access such credit – and we know that these consequences are indicative of deeper, more systemic, more troubling realities in lending practices.
It is heartening to know that the Court has recognized disparate impact as an important tool that helps to build a more integrated society; ?inclusive communities foster opportunity for all to prosper.
Moving forward, this tool has the promise to fight discrimination across sectors. We will continue to push for a?more fair and just marketplace, where responsible financial services are available to all.
For more information, contact Catherine An at 202-349-1878 or .
About the Center for Responsible Lending
The Center for Responsible Lending is a nonprofit, nonpartisan research and policy organization dedicated to protecting homeownership and family wealth by working to eliminate abusive financial practices. CRL is affiliated with Self-Help, one of the nation’s largest community development financial institutions.