Discrimination settlement holds subprime lenders accountable
By Eric Holder & Shaun Donovan
As a result, minority borrowers who were steered into subprime loans paid, on average, thousands of dollars more for their loans and experienced additional harm as a result of increased risk of prepayment penalties, credit problems, default and ultimately foreclosure. Nothing can undo the damage that hard-working, responsible families suffered as a result of these outrageous practices.
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However, the $335 million in relief for victims of discrimination will not only address their financial loss, it will make it abundantly clear that this kind of behavior will not be tolerated.
Since President Obama took office, this administration has worked to tackle the foreclosures that are harming families and devastating our communities.
We've pushed the banks hard to keep responsible families in their homes – and because we have, foreclosure notices are down 45 percent since early 2009. The Federal Housing Administration (FHA) has withdrawn the approval of over 1,600 lenders to participate in FHA programs – more than four times the number during the entire tenure of the previous Administration.
In 2009, President Obama formed the Financial Fraud Enforcement Task Force, chaired by the Justice Department, to wage an aggressive and coordinated effort to investigate and prosecute devastating financial crimes, like this one.
And, through the Wall Street reform law President Obama signed into law last year, we created a Consumer Financial Protection Bureau – the sole mission of which is to protect ordinary Americans from abuses like these.
With this fair housing discrimination settlement, we are ensuring that help will go to some of the families who need it most. We are telling irresponsible banks and mortgage servicers that the unfair practices of the past will no longer stand.
And most of all, we are reaffirming the basic tenets of who we are as Americans and what we believe. That this country succeeds when everyone gets a fair shot, when everyone does their fair share, and when everyone plays by the same rules.
Eric Holder is the attorney general of the United States and Shaun Donovan is the secretary of Housing and Urban Development.