Fair HousingIntermediateAlabama Exam

Which of the following describes 'disparate impact' in fair housing?

AA policy that explicitly names a protected class

BA facially neutral policy that has a disproportionately negative effect on a protected classCorrect

CA direct refusal to rent based on race

DAn advertisement using code words for a protected class, as is customary in this jurisdiction

Why A facially neutral policy that has a disproportionately negative effect on a protected class Is Correct

Answer B: A facially neutral policy that has a disproportionately negative effect on a protected class

Disparate impact theory holds that a facially neutral policy or practice can violate fair housing law if it has a disproportionate negative effect on members of a protected class, even without discriminatory intent — unless the policy is justified by legitimate business necessity.

Exam Tip: Fair Housing

Fair Housing questions test both federal (Fair Housing Act of 1968) and state-level protected classes. The federal protected classes are race, color, religion, national origin, sex, familial status, and disability. Many states add additional protections.

People Also Study

Key Terms to Know

Fair Housing Act

Federal law prohibiting discrimination in the sale, rental, or financing of housing based on race, color, national origin, religion, sex, disability, and familial status.

Steering

An illegal practice where a real estate agent directs buyers toward or away from certain neighborhoods based on the buyer's race, religion, national origin, or other protected characteristics.

Redlining

An illegal practice where lenders or insurers deny services or charge higher rates in certain neighborhoods based on the racial or ethnic composition of those areas.

Blockbusting

An illegal practice of inducing homeowners to sell by claiming that the entry of minority groups will lower property values.