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Daily Real Estate News  |  April 12, 2011  |   Agency Investigates Bad Upkeep in Minority REOs
The National Fair Housing Alliance, along with other Fair Housing agencies, is investigating whether the upkeep of REO homes in minority neighborhoods receives inadequate care in comparison to REOs in predominantly neighborhoods.

"HUD has issued regulations saying the failure and delay of maintenance or repairs on REO properties because of racial composition of a neighborhood" is an actionable offense under the Federal Housing Act, Steve Dane, an attorney with Relman, Dane & Colfax, said in a recent press conference held by NFHA and other fair housing organizations leading the probe.

In the investigation, the agencies are comparing REO properties in predominantly minority and white neighborhoods in Connecticut, Maryland, Ohio, and Virginia, and evaluating the neighborhoods using a scoring system that rates the REO properties on upkeep, maintenance, and curb appeal.

The overwhelming number of failing scores were identified in primarily African-American areas in Dayton, said Jim McCarthy, president and CEO of the Miami Valley Fair Housing Center in Ohio, another agency also conducting the investigation.

Several of the other cities and states in the study are reporting similar findings. For example, Erin Kemple, executive director of the Connecticut Fair Housing Center, says the average score for REO properties in white neighborhoods was 89 out of 100 compared to an average score of 78 in minority communities.

Source: “Housing Advocacy Groups Investigate Lenders, Asset Managers,” Housing Wire (April 11, 2011)

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Quiz: Fair Housing

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