Bay Area Black, Latina real estate couple lowballed $250K in home appraisal
"Somebody doesn't have to say that the reason why they did it is because we were Black or Puerto Rican, or people of color."
OAKLAND, Calif. (KGO) -- The Curtis family reached out to ABC7 News after seeing the now-viral story of a Marin City couple lowballed in what they believe was a racially biased appraisal. The Curtis family knew something wasn't right when they also received a low appraisal because both the husband and wife work in real estate.
Ronald who is Black and Dominique who is Puerto Rican believe they received the same treatment and decided to sit down with ABC7's Race and Culture Reporter Julian Glover to tell their story.
"We were in the process of doing a refinance. The appraiser came out and we were shocked when we saw the value of our home was $254,000 less than the appraisal we got months earlier," said Ronald Curtis.
The family's lender, Rocket Mortgage, owned by Quicken Loans, ordered the appraisal through an independent appraisal management company (AMC) in December 2020.
The home was valued at $900,000, but just months earlier in April the home appraised for $1,154,000 in an appraisal also ordered by the lender: a quarter-million-dollar difference.
Meanwhile, housing prices went up and interest rates fell.
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But the Curtis family was uniquely positioned to do their own investigation, surveying comparable homes to realize something wasn't right.
"I've been a realtor for over 10 years and currently I'm a licensed real estate broker," said Mr. Curtis.
"I've been training to become an appraiser for about two and a half years now. I'm due to take my test fairly soon," said Ms. Curtis.
After doing some research Ronald knew there was a greater issue at play.
VIDEO: Black California couple lowballed by $500K in home appraisal, believe race was a factor
"Somebody doesn't have to say that the reason why they did it is because we were Black or Puerto Rican, or people of color. But absolutely, that's the reason why," said Curtis.
The Curtis family immediately pulled reports of the comparable homes the appraiser used in their report from the MLS (multiple listing services) they have access to as licensed real estate professionals.
The family showed ABC7's Julian Glover pictures of the current status of the homes, blighted with boarded-up windows, a caved-in garage, and bricks lining a roof to hold shingles in place.
"He was just deliberately looking for a property that fits his price so he could lower our value," said Curtis.
Those same photos were also attached to the extensive, nearly 60-page complaint the family filed with the California Board of Real Estate.
The investigation is ongoing.
Meanwhile, interest rates have increased meaning the family missed out on a chance to save thousands of dollars a year on their mortgage by refinancing.
ABC7 reached out to Quicken Loans and received the following statement:
Quicken Loans truly regrets the frustration that Mr. Curtis and his family have experienced with their home loan. Under federal law, lenders are required to work with independent appraisal management companies who then assign the work to state-licensed professionals to conduct home appraisals as part of the mortgage process. The law's intent is to determine the home's value without any input or bias from the lender - or anyone else - participating in the transaction.
We have reached out to Mr. Curtis to gain his permission to order a new appraisal from a second licensed appraiser, at our expense as an accommodation to our client, to obtain an additional opinion of value. Quicken Loans values equity and fair lending and we stand prepared to assist Mr. Curtis in securing financing for his home if the second appraisal is sufficient to support the loan amount.
However, the Curtis family provided a voicemail showing a Quicken Loans representative only offered a second appraisal the day after ABC7 News reached out to the company for comment.
Out of frustration with the company, the Curtis family declined the second appraisal offered Monday, and in a follow-up statement, Quicken Loans informed ABC7 News the company now considers the case closed.
Given the current monthly mortgage rate, the Curtis Family informed ABC7 News they have signed a lease to rent a home and will likely sell their current property.
"We know the implications of what this means. It doesn't mean that it affects us for a month or two and then it goes away. This is stuff that affects us for generations," said Curtis.
Discrimination in the housing market is systemic and detrimental to marginalized people with consequences suffered across generations.
A 2018 report by the Brookings Institution on the "devaluation of assets in Black neighborhoods" found in most metro areas in the country, homes in majority-Black neighborhoods were valued for significantly less than homes in neighborhoods with virtually no Black residents.
The study found the differences in homes and neighborhood quality don't explain the devaluation of homes in black neighborhoods.
The study showed homes in the Bay Area's Black neighborhoods are valued at 27% less than homes of similar quality in white neighborhoods: a difference of $164,000 on average, among the worse differences in the nation.
Looking at the national picture, homes in Black neighborhoods with similar amenities are worth 23% less, $48,000 per home on average.
"We shouldn't have to scrub Blackness from our homes to get a fair shake in society," said Andre M. Perry, Senior Fellow at the Brookings Institution.
Perry wrote the Brookings Institution study on the devaluation of Black homes and wrote the book "Know your Price: Valuing Black Lives and Property in America's Black Cities."
As the Austin's story went viral, several Twitter users tagged ABC7's Julian Glover in Perry's work.
"Whether it's appraisals, whether it's real estate agent behavior, lending practices, all of these things in housing markets impact price, and it's clear that something is going on today that throttles the price of Black homes," said Perry.
"That's about $156 billion in lost equity across the country. It would have paid for more than 8 million college degrees, based on the average amount of a public four-year institution. It would have replaced the pipes in Flint, Michigan, 3000 times over-It's a big number," he said.
Those loses often go unseen and unreported.
That's why non-profit advocacy groups like the Fair Housing Advocates of Northern California (FHANC) encourage families to file formal complaints.
The FHANC represents victims of housing discrimination.
In California someone discriminated against on the basis of race, religion, gender, sexual orientation, disability, or age - among other protected classes - can file a complaint.
The executive director Caroline Peattie said she was stunned when she heard of the Austin's story.
"Folks can file an administrative discrimination complaint with the Department of Housing and Urban Development (HUD) and the California Department of Fair Employment and Housing," said Peattie.
If you would like to file a complaint, click here.
She also pointed out families or individuals facing housing discrimination have one year to file a complaint and two years to file a lawsuit in California.
There are remedies in both situations involving rentals and real estate purchases.
Peattie said most often action leads to settlements or reprimands on behalf of the negligent institution.
The process, however, can drag on taking months or even years for resolution.
Peattie said victims have better odds if they are represented.
"Racism needs to be addressed and remediated in ways that will be remembered," she said.
The Austin's are now considering filing a formal complaint.
Tate Austin is glad sharing her family's story has encouraged others to come forward.
"With people standing up and starting to fight back for social justice, I feel like the world is primed to have this conversation," said Tenisha Tate Austin.
"People are talking and they are standing up and letting people know that this is not just a one off thing. This is a systemic issue that needs to be changed," said Austin.
