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Discrimination in Real Estate?

By Gena Riede

Real Estate Broker/Owner with Riede Real Estate, Lic. 01310792

March 30, 2008 04:07 PM

Hello Sacramento Real Estate!

Take a look at the map to the left.

What do you see that might indicate a tad bit of discrimination?

Do you happen to see all the RED in California?

It seems that the companies who insure loans are doing a bit of what I call REDLINING!

This happens to be a practice that is not acceptable in Real Estate. In fact, a Reactor's license can be removed for redlining and be subjected to fair housing violations.

Then why pray tell can the mortgage insurers get away with such practice? So, how did the insurers manage to get away with discriminatory practice which obviously affects home buyers as well as current homeowners?

Block Busting and Redlining are both Fair Housing Violations. District Attorney for CA, what say you? Is this a practice that we as Sacramento Californians are going to tolerate? Are Realtors the only profession that must adhere to Fair Housing rules?

Step up. Same song just a different dance. Don't allow the mortgage insurers to categorize our neighborhoods, our County's and our State. Do you want to pay MORE on your home mortgage loan?

I wrote about Real Estate fraud back in 2006 and it's now 2008. It took 2 years for the District Attorney's office in CA to identify just a handful of these criminals who reeked havoc in Real Estate. There are plenty more and now District Attorney for CA, take a good look at the map above. Look at how the insurers for mortgage loans are effecting our California home buyers. Stop this practice of discrimination on our State and our home buyers.

Act and act now. Each County has their own District Attorney. Seems like their all hoping the other one does something, hugh? If this has touched a nerve with you, then Google CA District Attorney, find your District Attorney's Office and email them this article. Hopefully, they'll right this wrong.

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Eric Bouler

Gardner Realtors, Licensed in La. - New Orleans, LA

Listening to your Needs

This is bigger than the local DAs who can barely do there jobs as it is?

Mar 30, 2008 04:15 PM

Chuck Christensen

Your Financial Coach - Bellingham, WA

Or we could just not jump to conclusions and see these as statistics to say that these areas carry more risk of default....maybe due to employment loss of work due to commercial and industrial business problems. But just that the history of risk is too great for loss. Would you buy a crippled race horse and bet everything you have to finish in the top 3? But you think an insurance company should? Don't they have the right to refuse to insure a 3 time convicted Driving While Intoxicated person. Bad loans is what has got us into this problem....and lenders can't continue to loose money...that is why the FEDS and Government are using our tax dollars to bail them out.

Mar 30, 2008 04:26 PM

William Johnson

Retired - La Jolla, CA

Retired

Hello Gena, Well done and my hat is off to you. The politics in our country is eating away at it and it is most sad. Everyone wants to place blame and those that can enforce the responsibility are too busy with other matters. Back while all this was going on the see no evil, hear no evil and speak no evil philosophy must have been in its full glory. Yet we saw people getting rich as they bragged about just getting their license.

Mar 30, 2008 04:28 PM

Esko Kiuru

Bethesda, MD

Gena,

Mortgage insurers were the last ones in the real estate business to get whacked by the market and this is the result, possible redlining. Las Vegas made the list, too, and it'll hurt here as well.

Mar 30, 2008 04:30 PM

Eric Kodner

Madeline Island Realty - La Pointe, WI

CRS, Madeline Island Realty, LaPointe, WI 54850 -

Chuck, the problem is that HUD defines this practice as redlining and redlining is illegal. It doesn't matter whether it makes sense to the mortgage industry or not. It matters that the practice violates Federal Fair Housing law. No amount of perfume is going to make this pig smell any better.

Mar 30, 2008 04:31 PM

Lane Bailey

Century 21 Results Realty - Suwanee, GA

Realtor & Car Guy

Chuck hit it. If an area is defaulting, and the prices are not stabilizing, does it not make sense for the mortgage insurance companies (those shouldering the risk) to be nervous in those areas? Marking the areas because of the status of the residents would be illegal, but marking them because of the market conditions... different beast.

Mar 30, 2008 04:31 PM

Sarah Reinhart

Brumback Residential - Spokane, WA

Intesting conversation and feedback. I always appreciate the dialog of our profession (that is when we aren't fighting over the same listing) :)

Mar 30, 2008 04:47 PM

Chuck Christensen

Your Financial Coach - Bellingham, WA

It's not always about racial profiling....these geeks are in high tower offices and don't even see anything about people. Next time you check out a loan application...look an the 3rd or 4th page (depending on the program used.) and look at the government monitoring section...What race are you? Are you Hispanic or not? Male or Female?

Why is it people want to put signs in Spanish when English is this countries language...no other country puts their signs in another countries language. When I go to Canada, I speak their language as best I can to show respect to them. When I was in Korea, I tried to learn the language as best I could. I could tell cabbies where I wanted to go, I could order breakfast, lunch and dinner, and a beer!

Mar 30, 2008 04:58 PM

Lori Prizmich

ReMax Gold - Davis, CA

Real Estate Elevated

Good job Gena! This sounds like a job for the Attorney General of the State of California.

Mar 30, 2008 05:04 PM

Karen Anne Stone

New Home Hunters of Fort Worth and Tarrant County - Fort Worth, TX

Fort Worth Real Estate

Actually, all I see are PMI lenders wanting to protect their investments in areas of declining house values due to the value bubbles bursting. Redlining has to do with "drawing a red line" around certain geographical areas deemed poor risks... but that is usually done in areas due to "ethnic considerations." I am guessing that many of the areas in red are simply areas where the real estate bubble that ballooned over the last five years... has "popped." In my opinion, this has absolutely nothing to do with Blockbusting or the practice of "redlining" as defined by HUD. That... is redlining, and is illegal.

It is only discrimination if it is only done in "ethnic" areas. I am guessing that these red areas are all simply areas where the housing value bubble has burst. There is a difference.

Mar 30, 2008 05:41 PM

Missy Caulk

Missy Caulk TEAM - Ann Arbor, MI

Savvy Realtor - Ann Arbor Real Estate

Gena, South East Michigan is a big red too. We are constantly on the look out for it. There is a FBI unit brought in to the Detroit area to help out with it. I am amazed at some of the schemes I hear about.

Mar 30, 2008 11:32 PM

Bill Gassett

RE/MAX Executive Realty - Hopkinton, MA

Metrowest Massachusetts Real Estate

Gena this is an interesting subject. Some of your commenters have brought up some good points about the insurance companies protecting themselves. The best solution would be to find some middle ground. I am not sute how you do that.

Mar 31, 2008 12:00 AM

Jeff Dowler, CRS

eXp Realty of California, Inc. - Carlsbad, CA

The Southern California Relocation Dude

Good post, Gena. Guess we shouldn't be surprised at what we see here, but clearly problems are rapant on a number of fronts.

Jeff

Mar 31, 2008 02:26 AM

Gena Riede

Riede Real Estate, Lic. 01310792 - Sacramento, CA

Real Estate Broker - Sacramento CA Real Estate (916) 417-2699

Eric K, it appears as though this will only make more negative in an already suffering real estate market.

Eric B., you may be right. We may need some higher involvement.

Chuck,I don't think that discrimination of areas is what is needed in order to fix the problem. Just as I don't think discrimination in any way shape or form is good for our economy or people at large. That's my opinion but you are welcome to yours.

Mar 31, 2008 03:52 PM

Gena Riede

Riede Real Estate, Lic. 01310792 - Sacramento, CA

Real Estate Broker - Sacramento CA Real Estate (916) 417-2699

William, you're absolutely right. Sometimes I think that people can't see or won't see the nose in front of their face until it's bleeding.

Esko, since our code of ethics prohibits redlining and block busting, I find it amazing that insurers in real estate are able to do this and get by with it. Yes, we are all in for more pain with this type of map being generated and enforced.

Eric K., excellent. Couldn't have said it better. If it smells like a pig, it must be a pig!

Mar 31, 2008 03:57 PM

Gena Riede

Riede Real Estate, Lic. 01310792 - Sacramento, CA

Real Estate Broker - Sacramento CA Real Estate (916) 417-2699

William, you're absolutely right. Sometimes I think that people can't see or won't see the nose in front of their face until it's bleeding.

Eric K., excellent. Couldn't have said it better. If it smells like a pig, it must be a pig!

Mar 31, 2008 03:57 PM

Guy E. Gimenez

The PowerHouse Group - Austin, TX

ABR, CRS, GRI - Broker & Investor (512-731-5613)

Who do you thing contributes more to these "officials" campaigns...you or the big insurer's PAC's? Seen this all my life and it ain't gonna change until we have the resources and the desire to outpay the big boys.

Mar 31, 2008 03:59 PM

Gena Riede

Riede Real Estate, Lic. 01310792 - Sacramento, CA

Real Estate Broker - Sacramento CA Real Estate (916) 417-2699

Lane, redlining is redlining no matter how you look at it. And this not only is "red" but it also smells.

Sarah, it is always good to get other professional opinions and hopefully, there are enough listings to go around that we don't need to fight about them. We should always remember that there is enough to go around and that we will run into each other again so it's always good to act appropriately. Wouldn't you agree? Good discussion is good for the soul. It stretches us and hopefully, we learn when we stretch.

Chuck, considering that Spanish is a prominent language in the US, it would certainly be helpful to learn a little Spanish. I know that is something that I need to get a refresher course in. As far as page 3 or 4, there is always profiling in most everything...sometimes for the good and sometimes for the not so good. I think that we as professionals need to learn a little more compassion for our fellow human beings and this would be a bit of better world.

Mar 31, 2008 04:06 PM

Gena Riede

Riede Real Estate, Lic. 01310792 - Sacramento, CA

Real Estate Broker - Sacramento CA Real Estate (916) 417-2699

Lori, I think you might be right. Maybe even of the U.S.

Karen, Discrimination is still wrong. And when we have discrimination in any area it can and may lead to discrimination with ethnicity in the long run.

Missy, I wonder how long it will take for the "big guns" to address this? Any thoughts?

Mar 31, 2008 04:11 PM

Gena Riede

Riede Real Estate, Lic. 01310792 - Sacramento, CA

Real Estate Broker - Sacramento CA Real Estate (916) 417-2699

Bill, middle ground is typically a good thing but discrimination in my estimation is never good. I just don't see how this will end up helping but instead cause more issues. Could be wrong...goodness knows I have been wrong in the past but this one troubles me.

Jeff, definitely. There are so many issues and we don't need to add to them, in my opinion.

Guy, I'm sorry I don't follow...can you elaborate?

Mar 31, 2008 04:15 PM