“Gut punch:” Black redlining expert faces appraisal bias

History professor, wife suing mortgage and appraisal companies

Johns Hopkins' Nathan Connolly
Johns Hopkins’ Nathan Connolly (John Hopkins, Getty)

A Black expert in redlining was himself the subject of racial discrimination in the housing market, according to a lawsuit filed this week.

Johns Hopkins University history professor Nathan Connolly and his wife, Shani Mott, are suing lender LoanDepot, 20/20 Valuations and appraiser Shane Lanham for discrimination, the New York Times reported. The suit stems from a big disparity in appraisals for the couple’s Baltimore home.

The couple aimed to refinance their mortgage last summer to take advantage of low interest rates. They paid $450,000 for the home in 2017 and have spent $42,000 on renovations and upgrades.

Lanham, the owner of 20/20 Valuations, appraised the home for $472,000, much less than the couple expected. As a result, LoanDepot denied a refinance application.

Months later, the couple applied for another loan, this time with Swift Home Loans, but first made a few changes. They removed photographs of their family and had Connolly’s white colleague from the university pose as the homeowner.

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It was appraised for $750,000 – almost 60 percent more than the previous figure.

“We were clearly aware of appraisal discrimination,” Connolly told the publication. “But to be told in so many words that our presence and the life we’ve built in our home brings the property value down? It’s an absolute gut punch.”

The couple noted in the lawsuit that the family photos and posters in the home clearly pointed towards their race. They also accused Lanham of selecting poor comparisons to help with the valuation and making outsize reductions for factors such as a busy street.

The Biden administration unveiled a five-point plan in March to tackle racial bias in home lending and appraisals. Steps include giving appraisers clear direction about anti-discrimination laws and strenghtening enforcement of violations.

The administration’s task force also wants to diversify the appraisal workforce, which is 97 percent white.

— Holden Walter-Warner

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