The mortgages from these 10 companies account for more than half of all home loans originated during that time frame, and what they demonstrate, say the study’s authors, is that the local lending industry is perpetuating America’s historically racist housing policies.
“Mortgage lenders are not making loans in majority-black neighborhoods,” said Michael Lepley, the Fair Housing Center’s Senior Research Associate and the study’s co-author. “They aren’t advertising in majority-black neighborhoods. They don’t locate their branches in majority-black neighborhoods. They aren’t creating products that work in majority-black neighborhoods. And when people try to borrow money to buy a house in a majority-black neighborhood, they’re twice as likely to be denied by all the lenders we looked at.”
Broadly speaking, Lepley said that Cuyahoga County lending patterns of today are “strikingly similar” to the region’s redlining maps of the 1940s and 1950s. Those maps, officially called “residential security maps” were created by the Home Owner’s Loan Corporation (HOLC) and shaded red those areas with (or near) African-American populations, excluding them from the loan program.
The Fair Housing Center report noted that modern lending practices like credit scores and minimum loan amounts, which appear to be racially neutral, are often discriminatory in their effects. And in Cuyahoga County, the shift to online banking has been particularly harmful for minority communities.
Between 2016 and 2017, Cuyahoga County lost 22 bank branches (fourth most in the country) as lenders have increasingly shifted their business online. But in the City of Cleveland, less than 40 percent of households have internet access in most majority-minority neighborhoods. In some of those census tracts, less than 20 percent have internet access.
The numbers, though, largely speak for themselves. The following home loan origination data are from 2012-2016. (A PDF of the full report is available below.)
HOWARD HANNA MORTGAGE SERVICES
Total Originations: 5,645
Originations in minority census tracts (percentage of total): 480 (8.5%)
Percent of applications denied in white census tracts: 2.1%
Percent of applications denied in nonwhite census tracts: 4.2%
FIRST FEDERAL OF LAKEWOOD
Total Originations: 5,144
Originations in minority census tracts (percentage of total): 442 (8.6%)
Percent of applications denied in white census tracts: 4.6%
Percent of applications denied in nonwhite census tracts: 9.5%
THIRD FEDERAL SAVINGS & LOAN
Total Originations: 3,987
Originations in minority census tracts (percentage of total): 159 (4.0%)
Percent of applications denied in white census tracts: 5.9%
Percent of applications denied in nonwhite census tracts: 17.5%
FIFTH THIRD MORTGAGE COMPANY (and affiliates)
Total Originations: 3,673
Originations in minority census tracts (percentage of total): 375 (10.2%)
Percent of applications denied in white census tracts: 11.5%
Percent of applications denied in nonwhite census tracts: 28.9%
THE HUNTINGTON NATIONAL BANK
Total Originations: 2,259
Originations in minority census tracts (percentage of total): 293 (13.0%)
Percent of applications denied in white census tracts: 15.3%
Percent of applications denied in nonwhite census tracts: 27.1%
QUICKEN LOANS
Total Originations: 2,076
Originations in minority census tracts (percentage of total): 282 (13.6%)
Percent of applications denied in white census tracts: 19.8%
Percent of applications denied in nonwhite census tracts: 29.8%
PNC BANK
Total Originations: 1,608
Originations in minority census tracts (percentage of total): 321 (19.9%)
Percent of applications denied in white census tracts: 16.9%
Percent of applications denied in nonwhite census tracts: 32.8%
WELLS FARGO BANK
Total Originations: 1,600
Originations in minority census tracts (percentage of total): 291 (18.2%)
Percent of applications denied in white census tracts: 15.9%
Percent of applications denied in nonwhite census tracts: 25.2%
CROSSCOUNTRY MORTGAGE INC.
Total Originations: 1,299
Originations in minority census tracts (percentage of total): 213 (16.4%)
Percent of applications denied in white census tracts: 4.7%
Percent of applications denied in nonwhite census tracts: 8.7%
JPMORGAN CHASE BANK
Total Originations: 1,137
Originations in minority census tracts (percentage of total): 118 (10.4%)
Percent of applications denied in white census tracts: 20.7%
Percent of applications denied in nonwhite census tracts: 30.0%
Here’s the full report:
This article appears in Jul 11-17, 2018.
Duh, its not about race, its about money.
Why would a realtor or bank work to sell and write a mortgage for a $15,000 house, when they can do the same amount of work for a $200,000 house and make a lot more money?
This is a presentation of financial/economic facts. First, keep the property values in mind. A mortgage/loan on a property in a distressed area will not yield a return. A home values at $20k with a request for 30-year mortgage is worthless. The likely hood of this property yielding a gain is slim to none. Therefore, the owners, regardless of color of this property if they are utilizing intellectual and common sense will not continue to pay the mortgage. The facts reveal that most of these properties happen to be in Black dominated communities. This is itself is not racist, its called business. Until the city of Cleveland leadership truly begins to invest in the “communities” property values will remain flat or continue to decrease. Further and until segments of society can improve the earning power to purchase better and well maintained properties within the city limits, this problem will continue.
More leftist/communist style rhetoric that caused the mortgage/banking collapse in 2008 after the government forced banks to give loans to people who never qualified for them and never paid them back. In the 1990’s, under Clinton, the banks were prosecuted for “red lining” if they refused to give loans to minorities that didn’t have the ability to pay them back, this policy was then extended to all “low income” people and by then all the sound fiscal rules were thrown out – we saw how that ended up, didn’t we??? Why do you leftists/communists want to repeat it???
Recent biosocial research findings have uncovered sobering findings about the correlation beween living conditions and developmental pathways related to health. The first set of correlations indicates that crowded living space and comprised building safety produce a phemonenon “weathering” . This is a condition indicates premature deteriotaion in health, thus reducing human well being for those redlined into specific geographic areas. The second set of correlations
indicates that crowding and comprised neighborhoods can shorten the leanght of genetic material called telemere. Such a genedtic variation may lead to damage in infant capacity. Such damage can reduce functioning and thus well being.
Indeed, Greed above Need, perhaps contains echos of other regimes.