Housing and Fair Lending Policy

The Trump administration’s Department of Housing and Urban Development has opened a civil‑rights investigation into Washington state’s Covenant Homeownership Program, alleging it may provide subsidized mortgage assistance based on race in violation of federal fair‑housing law. HUD’s Office for Fair Housing and Equal Opportunity notified the Washington State Housing Finance Commission that it is scrutinizing the program, which was created in 2023 to address the legacy of racially restrictive covenants and offers first‑time buyers zero‑interest loans of up to $150,000 for down payments and closing costs, repayable only at sale or refinancing. According to HUD, applicants can earn up to 120% of area median income and must have a parent or grandparent of Hispanic, Native American, Pacific Islander or Indian descent, while people of European, Japanese, Arab or Jewish ancestry appear not to qualify, and access is routed through a commission‑run hotline that screens eligibility. HUD Secretary Scott Turner declared that “DEI is dead at HUD” and vowed to “vigorously enforce the Fair Housing Act,” framing the case as a challenge to what he calls illegal racial and ethnic preferences even as Washington lawmakers defend the program as a remedy for generations of discrimination including redlining and race‑based covenants. The probe will test how far states can go in crafting race‑conscious homeownership aid and is already feeding online battles over whether such programs are corrective justice or unlawful reverse discrimination.