Fair housing and immigrant advocacy groups are urging a federal court in Texas to reject a proposed settlement between Colony Ridge Development LLC and federal agencies over alleged predatory lending practices.
The groups say that key provisions of the agreement are “unlawful, unnecessary and unrelated to the underlying case.”
Under the proposed terms, Colony Ridge — a Texas-based land developer and lender — would pay $68 million to resolve allegations that it targeted Hispanic borrowers with abusive loan practices.
Of that total, $20 million would be directed toward immigration-related law enforcement initiatives. The company would invest $48 million in infrastructure improvements and also implement new underwriting standards and policies aimed at reducing foreclosures.
“[I]nstead of providing individual relief to the victims of Defendants’ predatory scheme, the settlement agreement appears intended to subject them to heightened surveillance, and, for some, could subject them to potential detention, family separation, or even deportation,” the brief states.
Representatives for Colony Ridge and the Consumer Financial Protection Bureau (CFPB) did not immediately respond to HousingWire’s requests for comment.
A spokesperson for the Department of Justice (DOJ) declined further comment beyond the agency’s initial news release. Assistant Attorney General Harmeet K. Dhillon of the Civil Rights Division said in the release that “the changes required by this settlement will promote public safety, and affordable and sustainable homeownership in America, key priorities of this Administration.”
The coalition — led by the National Fair Housing Alliance (NFHA) and also comprised of the League of United Latin American Citizens, Center for Responsible Lending, National Consumer Law Center, UnidosUS, the Poverty & Race Research Action Council, Public Justice and the Southern Poverty Law Center — filed an amicus brief on Wednesday urging the court to reject the deal.
In their filing, the groups argue that asking the court to retain jurisdiction to enforce the agreement is “improper and unlawful” because the immigration and law enforcement provisions are unrelated to the underlying fair lending claims.
In December 2023, the DOJ and CFPB sued Colony Ridge. They alleged the company operated an illegal land sales scheme and made false statements to tens of thousands of Hispanic borrowers in Texas, in violation of the Fair Housing Act and the Equal Credit Opportunity Act. The Texas Office of the Attorney General (OAG) filed a similar lawsuit in 2024.
Federal agencies alleged that Colony Ridge used misleading sales tactics — including misrepresentations about flooding risks — and failed to verify borrowers’ ability to repay, contributing to elevated foreclosure rates.
“The proposed agreement does not compensate the people or communities that were harmed by the predatory policies and actions of this developer,” said Mitria Spotser, vice president and federal policy director at the Center for Responsible Lending.
Odette Williamson, director of racial justice advocacy at the National Consumer Law Center, added that “money that should go to victims is instead being proposed for immigration enforcement, subjecting victims to increased risk of deportation.”
