Former top home mortgage lender Trident Mortgage Company, owned by Berkshire Hathaway, must provide mortgage subsidies of up to $10,000 to homeowners in majority-minority neighborhoods after claims of redlining, the Delaware Department of Justice announced Wednesday.
The company continues to deny any wrongdoing amid the $20 million multi-state settlement.
Redlining, or the practice of denying services like healthcare, insurance or credit to residents in majority-minority neighborhoods, is prohibited in the First State by the Delaware Fair Housing Act, the Equal Credit Opportunity Act and the Delaware Consumer Fraud Act.
“Redlining is one of the modern era’s most damaging and insidious forms of racism,” Delaware Attorney General Kathy Jennings said in a written statement. “Few practices have done more to enforce de facto segregation in our communities.”
Jennings worked with officials in New Jersey and Pennsylvania to reach Wednesday’s settlement. While Trident was based in Devon, Pennsylvania, until its closure in December 2020, its services reached into nearby counties and states, including New Castle County. Its affiliate company Fox & Roach Realtors — which the Department of Justice says shared many customers with Trident — still operates in Delaware.
The agreement of voluntary compliance requires Trident to fund an $18,400,000 loan subsidy program, which will be carried out by an undetermined lender. The company must make a “good faith effort” to use all of these funds within five years.
Both Trident and Fox & Roach agreed to adopt nondiscrimination policies and proactively encourage residents of majority-minority neighborhoods to apply for the subsidized loans. The Department of Justice said Trident will be given an assessment of these neighborhoods in the affected regions in the next month.
The nature of the settlement means there were no official charges or court involvement. Still, Jennings said any redlining “has caused unspeakable harm,” including higher rates of poverty and predatory lending.
“I’m grateful for the work of our staff and our partners who took on this fight and who have secured crucial assistance for the communities impacted by redlining,” Jennings said.
Delawareans living in a majority-minority tract who are seeking information on the settlement or eligibility to participate in the loan subsidy program can contact the Department of Justice’s Consumer Mediation Unit at 800-220-5424 for assistance.
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