The 7th Circuit Court of Appeals affirmed summary judgment for a lender after it found an African-American couple failed to prove they were denied a loan based on racial discrimination under the Equal Credit Opportunity Act.
Mario and Tiffiny Sims, an African-American couple, purchased a home in South Bend from John Tiffany for $185,000 in October 2008. In Dec. 2009, the Bank of New York Mellon notified the Simses that it was foreclosing on the property, as Tiffany had stopped paying his mortgage on the home earlier that year and still owed $126,000.
After four years of fruitless pursuit to assume the mortgage, the Simses acquired a quitclaim deed for the property from Tiffany in 2012. New York Mellon foreclosed on the home in 2013 and nine months later, loan servicer Shellpoint advised the Simses of what information they needed to provide in order to apply to assume the loan.
The Simses alleged that Shellpoint frequently rebuffed their inquiries as to their application’s status over the following months and further insisted Shellpoint personal sometimes hung up on them or sent their calls to voicemail and did not call back.
According to an affidavit prepared by one of Shellpoint’s representatives, however, the Simses never submitted an application that Shellpoint deemed complete enough to warrant review.
Eventually the Simses spoke with Shellpoint employee K’tia Cox, who they believed to be African‐American and who allegedly told them, “These people, you know how they treat us.”
After several unsuccessful attempts at assuming the loan, The Simses sued Shellpoint under the Equal Credit Opportunity Act, claiming it discriminated against them based on race by delaying their effort to assume Tiffany’s loan.
The district judge granted summary judgment to Shellpoint, finding that the Simses “probably were not ‘applicants’” under the Act because they were seeking to assume a line of credit, rather than to “exten[d], renew, or continu[e]” one.
The judge further found that Cox’s statement was “ambiguous and lacked foundation” and was thus insufficient to show race discrimination, finding the Simses failed to present evidence of discrimination under either a disparate impact or disparate treatment theory.
“In the end, the ‘dearth of evidence from the Simses’ precluded them from calling into question Shellpoint’s conduct or conclusion that they did not complete the prerequisites for assuming the loan.”
On appeal, the Simses argued that they presented enough evidence to withstand summary judgment. Specifically, they advanced a disparate treatment theory and asserted that Cox’s uncontroverted statement shows that Shellpoint discriminated against them based on race by delaying the assumption process and requiring them to bring the loan current before assuming it.
In a brief explanation, the 7th Circuit found the district court’s judgement to be correct, noting that “no reasonable jury could find that Shellpoint discriminated against the Simses based on their race” in Mario Sims v. New Penn Financial LLC, 18-1710.
"For their suit to survive summary judgment, the Simses needed to put forth enough evidence of discrimination to establish a dispute of material fact,” the panel wrote in the per curiam opinion. “But their only evidence is Cox’s statement, which is vague and requires too much speculation to conclude that their race motivated Shellpoint to require them to satisfy Tiffany’s outstanding loan payments.”
“Rather, that requirement is consistent with the loan agreement, which conditions assumption on Shellpoint’s determination that its security would not be impaired. Moreover, the Simses do not point to evidence countering the Shellpoint representative’s statement that they never produced a complete application.”