Fair Housing Act Information

Filed under: Fair Housing Act

fair housingA current hot topic in our world of mortgage lending is fair housing. The Fair Housing Act prohibits discrimination by direct providers of housing, such as landlords and real estate companies, as well as other entities, including municipalities, banks or other lending institutions and homeowners insurance companies whose discriminatory practices make housing unavailable to persons based on:

  • race or color
  • religion
  • sex
  • national origin
  • familial status
  • disability

In cases involving discrimination in mortgage loans or home improvement loans, the Department may file suit under the Fair Housing Act and the Equal Credit Opportunity Act. Under the Fair Housing Act, the Department of Justice may bring lawsuits where there is reason to believe that a person or entity is engaged in a “pattern or practice” of discrimination or where a denial of rights to a group of persons raises an issue of general public importance.

Now, this has become a serious issue because if you happen to have an IDX feed on your website, you may be subject to a Fair Housing Violation lawsuit, even if it is not your listing! And, if you or a broker have an IDX feed, you may be liable for the listing agent’s fair housing violation, but he or she will not be liable.

This means that all real estate agents are responsible for all the listings on their website, including those on an IDX feed, and agents are also responsible for all listings they email to buyers from the MLS. So, if you are involved with an IDX feed, be aware that you may possibly be sued by the general public who decide to become Independent Fair Housing Testers. Unfortunately, you also need to realize that it is easy for any tester to file a lawsuit against any and all real estate agents.

An example of this came into play last week. According to Brian Stevens and Frank Garay from the National Real Estate Post, the idea of fair housing is so you can’t discriminate against anyone for any reason. However, this fair housing can definitely be manipulated for the benefit of some and the unreasonable cost of others.

They explained that a real estate agent had an IDX feed on his blog. This allowed potential buyers and independent fair housing testers to go and search any listing that the IDX feed is set up to import. An independent tester went to the blog and found a listing that said “no one under the age of 16 need apply.”

Now, according the Fair Housing Act, that is a violation. The tester saw this, reported it, and now the realtor is facing a federal lawsuit. However, the agent being sued is not the listing agent.  And not only is the realtor facing a law suit, but so is his broker and the homeowners association of the property, but not the agent that violated the actual fair housing law on the listing that popped up on the IDX.

So please be aware of all of the information you have on your IDX feed as it could possibly lead to some future problems that you really don’t want to face.  You’ll want to discuss this with your broker and perhaps seek some legal advice.


Franklin Loan Center | NMLS 237653
Licensed by the Department of Financial Protection and Innovation under the California Residential Mortgage Lending Act, 4131316
For questions or concerns please email info@franklinlc.com