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After she concealed her race, Black Indianapolis owner's home value more than doubled

The homeowner suspected race played a role in her first two low appraisals. Now her experiences are part of complaints with federal housing authorities.
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A Black Indianapolis homeowner who had a nagging suspicion that her house was lowballed in two appraisals last year went to great lengths to conceal her race in a third. She removed photos of herself and her relatives and had a white friend pose as her brother for the appraiser's home visit.

The result? The appraisal of Carlette Duffy's home more than doubled.

Duffy's home, which was assessed by different companies last year, was first appraised at $125,000, then $110,000 and finally $259,000 in November, according to the Fair Housing Center of Central Indiana. The nonprofit announced this month that it had filed housing discrimination complaints on Duffy's behalf with the Department of Housing and Urban Development.

Amy Nelson, executive director of the group representing Duffy, said it's "heartbreaking" that she had to do so much to secure a fair appraisal.

Image: Carlette Duffy
Carlette Duffy at the Fair Housing Center of Central Indiana on May 6.Michelle Pemberton / USA Today Network

"In order for the value of her home to be accurate, she had to remove herself completely from the home," Nelson said Monday. "She was at first ecstatic that she did in fact get the value that she thought her home deserved. ... But then almost immediately after, she was heartbroken with the fact of what she had to do in order to get that value."

Duffy was unavailable for comment Monday.

Duffy, who was trying to refinance her mortgage last year, took additional steps on her third appraisal to ensure better results, according to the Fair Housing Center.

She did not declare her race or gender as part of the appraisal application process, and she limited her interactions with the appraiser to email, Nelson said.

The complaints allege discrimination against Duffy based on her "race" and "color." They argue that the lower valuations amount to violations of "Title VIII of the Civil Rights Act of 1968 as amended by the Fair Housing Act of 1988."

The first complaint names Citywide Home Loans, its employee Craig Hodges and Jeffrey Pierce of Pierce Appraisal Inc. No one named in the complaint responded to requests for comment Monday. The complaint says Pierce visited Duffy's home on or around March 31, 2020.

The complaint says that Duffy's home is in a historically African American neighborhood and that Pierce was "purposely pulling comps for the appraisal that were not fair and were racially motivated."

The second complaint names Andre Mammino and Doug Frimmet of Freedom Mortgage. Mammino and Frimmet could not be reached for comment. Freedom Mortgage did not immediately respond to a request for comment. The complaint also named Timothy Boston of Appraisal Network. Boston, reached by phone Monday, declined to comment. The complaint named a third-party company, SingleSource, which assigned Boston for the appraisal. Representatives of the company did not comment.

The complaint alleges that on or about May 26, 2020, Boston conducted a home appraisal. Duffy later learned that it had valued her property at $110,000, with a cash-out value of $96,000.

Duffy had bought the home three years earlier for $100,000. At the time of the first two appraisals, "home values were rising dramatically," according to a statement from the Fair Housing Center. Duffy challenged the appraisals with market analysis data and was rebuffed both times, the nonprofit's statement said.

Andre Perry, a senior fellow with the Brookings Institution, a nonprofit public policy organization based in Washington, said housing discrimination against the Black community is a systemic problem plaguing the country.

Perry co-authored a 2018 study, "The devaluation of assets in Black neighborhoods," which concluded that homes in predominantly Black neighborhoods in 2017 were appraised 23 percent lower than similar homes in majority white neighborhoods.

The loss in equity cost homeowners in Black neighborhoods $156 billion in 2017, said Perry, the author of the book "Know Your Price: Valuing Black Lives and Property in America's Black Cities."

He said Duffy's experiences during the first two appraisals are not unique.

"When a white person stands in for a Black owner, you're literally seeing the intrinsic value of whiteness being played out," said Perry, who said undervaluing homes in Black neighborhoods is stealing from homeowners.

"In real terms, that is someone's college tuition. That is a business that should have been started. That is the resources to protect against the next pandemic," he said. "You're robbing people of opportunity."

Perry said there should be safeguards to protect homeowners from having their properties appraised at less than market value.

"When an owner feels something is off, they should have another level of recourse to dispute the original appraisal. We need accountability systems," he said. "If someone is off by a significant margin, they should lose their license."

Nelson, of the Housing Center of Central Indiana, said the appraisal industry has a diversity problem.

"It's overwhelmingly white males," she said. "That is never good when there is a lack of diversity."