The case centers around a Black homeowner who applied for refinancing with Rocket Mortgage in January 2021. To facilitate the required appraisal, Rocket Mortgage engaged Solidifi, which then hired Mykhailyna and his company, Maverick Appraisal Group.
In a significant move today, the Justice Department announced a lawsuit against Rocket Mortgage LLC, Solidifi US Inc., Maverick Appraisal Group Inc., and appraiser Maksym Mykhailyna, alleging racial discrimination in the appraisal of a Black homeowner’s property. The lawsuit claims that the home was undervalued based on the owner’s race during a mortgage refinance process.
“This lawsuit is part of our ongoing efforts to bring an end to appraisal bias which prevent Black communities and other consumers of color from accessing credit and benefitting from homeownership,” said Assistant Attorney General Kristen Clarke of the Justice Department’s Civil Rights Division. “Appraisal bias exacerbates the racial wealth gap, and runs contrary to the principles of fairness, transparency and equity that we need in our housing market today. The Justice Department will continue to hold appraisers, lenders and others who discriminate against loan applicants accountable for their actions. No one should have to suffer the indignity and financial harm associated with appraisal bias.”
The case centers around a Black homeowner who applied for refinancing with Rocket Mortgage in January 2021. To facilitate the required appraisal, Rocket Mortgage engaged Solidifi, which then hired Mykhailyna and his company, Maverick Appraisal Group. The home, situated in a predominantly white neighborhood in Denver, was appraised by Mykhailyna using sales data from neighborhoods with larger Black populations, overlooking comparable properties just a mile away that were more relevant to the appraisal.
Shockingly, the appraisal provided by Mykhailyna was more than $200,000 lower than a prior assessment of the same home—an astonishing drop of over 25% despite rising home values in the area. The complaint details how Mykhailyna’s methodology deviated from industry standards, raising concerns that the property was deliberately undervalued due to racial bias.
“The complaint alleges racially discriminatory practices by a lender and an appraiser that harmed a homeowner. These discriminatory practices have gone on for too long in Denver,” said Acting U.S. Attorney Matt Kirsch for the District of Colorado. “The U.S. Attorney’s Office is committed to addressing persistent inequities in housing through vigorous enforcement of federal laws prohibiting discrimination in housing and lending.”
After receiving the appraisal, the homeowner reached out to Rocket Mortgage, expressing her belief that the assessment was discriminatory. In a troubling twist, the company responded by canceling her refinance application. Following this, she filed a complaint with the Department of Housing and Urban Development (HUD), which launched an investigation and found reasonable cause to suspect violations of the Fair Housing Act.
The Justice Department’s lawsuit seeks accountability for the alleged discrimination, sending a strong message about the need for fairness and equality in the housing market. As this case unfolds, it highlights the ongoing challenges faced by minority homeowners in securing fair treatment in real estate transactions.
“HUD applauds today’s action and remains committed to working with DOJ to ensure appraisal companies and mortgage providers are held accountable when they violate our nation’s fair housing laws.” said Principal Deputy Assistant Secretary Diane M. Shelley of HUD’s Office of Fair Housing and Equal Opportunity. “It has been over 56 years since the passage of the Fair Housing Act, and it is unconscionable that Black and Brown families still face discrimination during housing transactions.”
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