US FederalWhat is redlining and is it illegal under federal law?
Redlining is the discriminatory practice of denying housing services—like loans or insurance—to people based on the racial composition of their neighborhood. It is illegal under the federal Fair Housing Act.
What the Law Says
The Fair Housing Act (FHA) prohibits redlining by banning discrimination in housing-related transactions based on race, color, religion, sex, national origin, familial status, or disability.
Redlining historically involved banks and insurers literally drawing red lines on maps around predominantly Black or minority neighborhoods—and then refusing to lend, insure, or invest there. Today, it includes any policy or practice that denies housing opportunities based on neighborhood demographics rather than individual creditworthiness.
The FHA makes it unlawful not only to deny housing outright but also to engage in 'other prohibited practices' that have a discriminatory effect—even if no explicit intent to discriminate is shown. This includes steering, unequal terms, and discriminatory lending or appraisal practices.
Statutory TextTo refuse to sell or rent after the making of a bona fide offer, or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling to any person because of race, color, religion, sex, familial status, or national origin.
— Fair Housing Act, 42 U.S.C. § 3604(a) — Discrimination in housing
Statutory TextTo discriminate against any person in the terms, conditions, or privileges of sale or rental of a dwelling, or in the provision of services or facilities in connection therewith, because of race, color, religion, sex, familial status, or national origin.
— Fair Housing Act, 42 U.S.C. § 3604(b) — Discrimination in housing
Statutory TextTo make unavailable or deny a dwelling to any person because of race, color, religion, sex, familial status, or national origin — by means of: (1) refusing to make a mortgage loan or other loan secured by residential real estate; (2) refusing to provide information regarding loans; (3) imposing different terms or conditions on a loan; or (4) engaging in other discriminatory practices.
— Fair Housing Act, 42 U.S.C. § 3604(f)(1)–(4) — Discrimination in residential real estate-related transactions
What to Do
File a complaint with the U.S. Department of Housing and Urban Development (HUD) within one year of the alleged violation.
Contact a fair housing organization for free counseling and assistance.
Document all interactions—including emails, loan denials, appraisals, and neighborhood comparisons.
Consider filing a private lawsuit in federal or state court within two years (if seeking damages).
Report patterns of suspected redlining to the Consumer Financial Protection Bureau (CFPB) or the Department of Justice.
Sources
Not legal advice. This article is general information based on publicly available sources, written for educational purposes. Laws change and individual situations vary. Consult a licensed attorney in your jurisdiction before acting on anything you read here. Last reviewed: 2026-06-08.