On July 15, 2020, the Consumer Financial Protection Bureau filed a lawsuit against Townstone Financial, Inc., a Chicago-based mortgage lender and mortgage broker, alleging that Townstone “redlined” African-American neighborhoods in the Chicago Metropolitan Statistical Area and discouraged prospective applicants from applying to Townstone for mortgage loans on the basis of race. This marks the first time that a federal regulator has taken a public redlining action against a non-bank mortgage lender.
Read more about the CFPB’s allegations and the implications for mortgage lenders in Mayer Brown’s Legal Update.