Tuesday, June 5, 2012

Head U.S. Civil Rights Fed: Blacks, Latinos Likely "Paid What Amounted To A Racial Surtax" On A SunTrust Home Loan

The Associated Press reports:

  • SunTrust Mortgage Inc. agreed Thursday to pay $21 million to settle a federal lawsuit alleging racial discrimination in its lending practices, the second-largest fair lending settlement ever obtained by the U.S. Department of Justice.

  • A complaint filed by the department in U.S. District Court in Richmond said SunTrust Mortgage charged more than 20,000 black and Hispanic borrowers more than similarly qualified non-Hispanic white borrowers between 2005 and 2009. Minority borrowers in 75 geographic markets stretching from Virginia Beach to San Francisco paid more in loan fees or higher interest rates based solely on race or national origin, according to the complaint.
  • Thomas E. Perez, assistant attorney general for the Civil Rights Division, said the agreement is second only to last year's record $335 million fair-lending settlement with Countrywide.

  • "At the core of the complaint is a simple story: If you were African-American or Latino, you likely paid more for a SunTrust loan than a similarly qualified white borrower simply because of your skin color," Perez said in a teleconference with reporters. "You paid what amounted to a racial surtax that ranged from hundreds to thousands of dollars."
For the U.S. Justice Department press release, see Justice Department Reaches $21 Million Settlement to Resolve Allegations of Lending Discrimination by Suntrust Mortgage (Borrowers Were Charged Higher Fees Based on Their Race or National Origin in 2005-2009 Before the Company Implemented New Policies).

No comments: