Housing Department's Redlining Retreat Grants Mortgage Lenders a Reprieve
An internal memo tells staff to focus on discrimination against individuals, not neighborhoods, in a potential threat to redlining cases.
HUD has already slashed spending on fair housing enforcement and reassigned lawyers and other career employees once focused on it.
Photographer: David Paul Morris/BloombergThe US government is retreating from its mission of ensuring banks and other big financial companies don't discriminate against neighborhoods with high populations of racial minorities when making home loans.
The practice of redlining — denying financial services to entire neighborhoods — has for years been a key focus of the Department of Housing and Urban Development, whose lawyers have fought to enforce fair-housing laws that ban it. But a recent internal memo, obtained by Bloomberg News, says HUD investigators should no longer consider how financial firms behave in particular neighborhoods, focusing instead on how the companies treat individuals. The shift nearly eliminates the chances the department will pursue new redlining cases under the Trump administration, experts say.