Philadelphia Commission Announces $2M from Wells Fargo Settlement

In Philadelphia, about 1030 African-American homebuyers may be eligible to receive funds from the $175 million discrimination settlement with ""Wells Fargo"":https://www.wellsfargo.com/, the Pennsylvania Human Relations Commission announced Thursday.

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The funds would be for African-American homebuyers in the area who may have been victims of illegal predatory lending schemes. The funds includes $2 million for Philadelphia residents who originated home loans with Wells Fargo between January 1, 2004 and December 31, 2009. An additional $50 million has been designated for a new homebuyer assistance fund in which qualified buyers in eight metropolitan areas can receive up to $15,000 for down payments.

African-American borrowers who qualified for prime loans but received nonprime rates instead from Wells Fargo might be eligible for cash rebates. A federal government designee will reach out to potentially eligible recipients.

""Fair housing is a right in Pennsylvania,"" Commission Chairman Gerry Robinson said. ""This settlement will help ensure that it is a reality.""

The commission investigation was prompted by statistical analysis from HUD, which revealed substantial disparities in pricing and foreclosure rates between African-American and white borrowers. This type of systematic targeting violates the federal Fair Housing Act and the Pennsylvania Human Relations Act.

""The $175 million settlement with Wells Fargo, one of the nation's largest lenders, is an indication that aggressive investigation can result in justice for those victimized by patterns of discrimination on the basis of race or national origin,"" said Congressman Chaka Fattah (D-Pennsylvania) in a statement.

In a statement Thursday, Wells Fargo said it settled only for the purpose of avoiding litigation with the Justice Department.

""Wells Fargo is settling this matter because we believe it is in the best interest of our team members, customers, communities and investors to avoid a long and costly legal fight, and to instead devote our resources to continuing to contribute to the country's housing recovery,"" said Mike Heid, president of Wells Fargo Home Mortgage.