Toledo is getting $1.4 million out of $42 million that Wells Fargo Bank will pay to settle one of the nation’s largest housing-discrimination claims.
The settlement stems from allegations that Wells Fargo had a pattern of maintaining and marketing foreclosed houses in white neighborhoods more aggressively than ones in African-American and Latino neighborhoods. Evidence was provided by the National Fair Housing Alliance to the U.S. Department of Housing and Urban Development.
In Toledo, more than 200 foreclosed homes that Wells Fargo owns or has been associated with were investigated by the Toledo Fair Housing Center.
Michael P. Marsh, the center’s president and chief executive officer, said the local investigation revealed consistent deficiencies in neighborhoods inhabited largely by people of color, such unrepaired siding, roofs, gutters, and doors. Lawns were mowed less often in such neighborhoods, more trash accumulated, and upkeep was generally lacking compared with properties in predominantly white neighborhoods, Mr. Marsh said.
He called the decision a “ground-breaking, precedent-setting settlement” that will result in new grants for homeowners and would-be homeowners hit hardest by the foreclosure crisis. Details of the size and number of individual grants will be decided in the coming weeks by the national alliance, Mr. Marsh said.
“This $1.4 million investment will have a substantial impact on the home-ownership opportunities in our communities of color, where access to capital has always been a struggle,” he said.
The settlement calls for more than $42 million in payments for 44 cities.
Wells Fargo has agreed to pay $27 million to the National Fair Housing Alliance and 13 fair housing organizations that are parties to the agreement, including the Toledo Fair Housing Center. The money will be used to help 19 cities, including Toledo and Dayton, promote more home ownership, neighborhood stabilization, property rehabilitation, and development in communities of color, the consumer group said.
The other $15 million includes $11.5 million Wells Fargo will pay the U.S. Department of Housing and Urban Development for work in 25 other cities, including Detroit.
Wells Fargo said in a prepared statement that the company has “strongly denied the [discrimination] allegations” and said it looks forward to working with HUD and the national housing alliance to provide better housing opportunities for all, irrespective of race or national origin.
Wells Fargo said it has spent an average of nearly $11,000 per home for repairs since 2009, which comes to $775 million for 71,000 properties.
The company said it also has donated 2,974 properties and sold 3,728 others at discounts to government and nonprofit groups.
The national alliance said it has similar complaints pending against US Bank and Bank of America, filed in April, 2012, and September, 2012, respectively.
Many of the problems stem from predatory lending practices, Mr. Marsh said.
“These institutions continue to auction thousands of homes across the country for pennies on the dollar to investors, rather than offering them to homeowners,” he said. “This continues to fuel the decline of property values in working-class neighborhoods.”
Contact Tom Henry at: email@example.com or 419-724-6079.