Claimed BOA bias in Phoenix market
The National Fair Housing Alliance reported that research shows distressed real estate in Phoenix minority neighborhoods, along with seven other metropolitan areas, was poorly maintained by Bank of America. Bank of America is one of the largest financial institutions that maintains and sells foreclosed properties.
After an undercover investigation regarding 373 foreclosed homes across the country, the NFHA filed the complaint with the U.S. Department of Housing and Urban Development claiming foreclosed homes in affluent neighborhoods were listed in good condition, while low-income neighborhood properties were found in poor condition. In the Phoenix area, eight homes were under investigation.
In Phoenix, 86 percent of the properties owned by the bank were missing a for-sale sign on the lawn in predominantly black or Latino neighborhoods. Real estate experts said this could lead to a property becoming damaged in a storm, for instance, or unwarranted occupants to remain in those states. Also, homeowners and neighbors wouldn’t be aware the home is available.
The bank was also alleged to have left several properties unmaintained - some had trash on the property. Similar issues, all of which could be solved with regular maintenance, affected 71 percent of properties in Phoenix.
Peter Romer-Friedman, counsel for the alliance, told Bloomberg that under the Federal Fair Housing Act, Bank of America is required to maintain and market its properties equally without discriminating against a certain neighborhood. The report noted homes had issues such as damage, yards filled with trash, overgrown grass, broken or boarded windows, damaged fences, peeling paint, no trespassing signs and broken gutters. This practice can drive down property values in the rest of the
neighborhood, which Phoenix residences are just recently experiencing an increase in.
"It has an enormously harmful and far-reaching impact," Romer-Friedman told Cronkite News. "It discourages potential purchasers from buying homes in communities of color. It restricts the housing choices in communities of color and leaves purchasers of properties in these communities struggling to remediate problems caused by months or years of neglect."
Other communities that have been effected by the alleged neglect include Dayton, Ohio, Grand Rapids, Michigan, Atlanta, Miami, Florida, and Dallas. According to Shanna L. Smith, the president and CEO of NFHA said the bank has been notified about its failure to maintain real estate owned properties in the summer of 2009 and has not made any improvements.