Black Borrowers Facing Racial Housing Gap

"The most comprehensive study of mortgage bias was conducted by the Boston Federal Reserve Bank and considered 38 different factors that could result in disparate lending. Among the factors examined were several measures of income, credit history, loan type and collateral. Even with all factors considered, blacks were still nearly 60 percent more likely to be rejected for a mortgage compared to similarly credit-worthy whites...Furthermore, two follow-up studies, both of which added control variables, found equal or higher levels of bias than were found in the original study.

"The collective impact of housing bias is enormous. Most obviously, it deprives families of color of billions of dollars in lost potential wealth and assets. Studies place the cost of present-day discrimination at over $4 billion annually for people of color, and further estimate that today's black communities have been deprived of nearly half-a-trillion dollars in wealth due to past and present housing discrimination in the U.S.

"Likewise, housing preferences and subsidies for white families (in the form of Homestead Act benefits, and racially-restrictive FHA and VA loans), alongside "urban renewal," (which resulted in the destruction of about one-fourth of all homes lived in by African Americans in the 50s and 60s to make way for office parks, parking lots and shopping centers), have pushed the racial housing gap in America to chasm levels."

Thanks to Michael Dudley