I have come across this practice more and more and find it quite disturbing...
Just as a refresher...REDLINING is the practice of openly discriminating against a particular area or neighborhood especially when considering the race or ethnicity of an area. And, if I am not mistaken, it is expressly against the Realtor(r) code of ethics.
Now, in my industry -- internet based referral procurement, I speak with Realtors(r) all day long. And I continually run into the same issues that I feel directly fall into that realm. And I wonder how these people feel justified in saying some of the things that they do...For example:
"No...I dont work that area...Your client wouldnt want to buy a house there. It's not a good neighborhood, if you know what I mean..."
"I wont go to that part of town without a gun and an escort. You would need it to keep up with the locals."
"I dont work that area, it's too (insert color or ethnic slur here) for me." (This last one appalled me so much, I contacted the Board of Realtors(r) for the area and reported that individual. Shameful.)
I was curious if you had experienced anything like this type of activity and what, if anything, can be done with regard to those that continually redline areas based on race or ethnicity. Any feedback would be appreciated.
UPDATE ------ I would very much like to thanks Jean for her expaination of the redlining and steering and the basic definitions of the terms. Much appreciated! Thanks again, Jean!
If you would like information about www.recr.com, please contact Clint at 800-977-7058.
Redlining is an ethics issue, but more than that it is a Fair Housing violation. There was a case study where a lender in Detroit refused to give loans in certain areas. HUD found out and the company was fined heavily plus they had to set up training classes and open a branch office in the area where they were Redlining. As far as REALTORS® go, we are required to show Clients/Customers properties which they are qualified for otherwise we will be in violation of Fair Housing. HUD and your State Real Estate Board takes this very seriously.
Good Post!
You can't approach the ethnicity of a neighborhood but you sure as heck can say "No, I won't go there without a gun and an escort."
Race has always bothered me -- we're the HUMAN race. Everything else is just where, geographically, your family traces back to.
Redlining is the practice of denying or increasing the cost of services, such as banking, insurance, access to jobs,[2] access to health care,[3] or even supermarkets[4] to residents in certain, often racially determined,[5] areas. The most devastating form of redlining, and the most common use of the term, refers to mortgage discrimination. The term "redlining" was coined in the late 1960s by community activists in Chicago. It describes the practice of marking a red line on a map to delineate the area where banks would not invest. During the heyday of redlining these areas were most frequently black inner city neighborhoods.
Racial steering refers to the practice in which real estate brokers guide prospective home buyers towards or away from certain neighborhoods based on their race. Racial steering as defined by The Yale Law Journal is often divided into two broad classes of conduct;
Have a great week!
Katherine -- Well, I apprecaite the compliment...but, I dont think its about having the cajones...Its about doing the right thing. I made that guy a personal mission of mine to get removed. :-)
Monika -- Glad you dont see it much there...thats awesome. I work all over the country...and you would be amazed what you hear when you call places like Houston, Detroit, DC, L.A., etc...
There are actually attractive financing options that appear in areas that could be considered as "redlined" because the banks will create specialty "community loan programs" aimed at those areas to prevent unintentional fair housing violations such as redlining. For instance, CITI just announced a 100% loan with very relaxed credit requirements in certain zip codes that they were concerned would indicate they had been redlining. That is one of the only 100% conventional loan programs available in my area right now because it has been declared a declining market.