The New Redlining

Mortgage lenders are increasingly imposing new loaning restrictions on risky areas encompassed by entire ZIP codes and county lines, creating what some are calling the "new redlining".

1 minute read

February 5, 2008, 10:00 AM PST

By Nate Berg


"On Jan. 25, Countrywide Bank sent mortgage brokers a list that categorized hundreds of counties as "soft markets" with rankings from 1 to 5, in ascending order of perceived risk. In areas rated 4 and 5 -- roughly 100 counties in metropolitan areas nationwide -- Countrywide said it will now require down payments that are 5 percentage points higher than from most applicants. If a loan program had previously allowed a minimum 5 percent down payment, applicants in these areas will now be required to come up with 10 percent."

"An additional 970-plus counties are rated more moderate risks, in categories 1 to 3, with down payment increases of 5 percentage points if an appraisal report indicates there is an "oversupply" of houses for sale or a marketing time of more than six months."

"Critics charge that imposing higher down payment standards or other penalties for applicants in an entire county, metropolitan area or Zip code is unfair to homeowners and buyers whose properties are located in submarkets or neighborhoods within those jurisdictions that may not be declining in value, or not by enough to justify punitive underwriting requirements."

Saturday, February 2, 2008 in The Washington Post

portrait of professional woman

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching. Mary G., Urban Planner

I love the variety of courses, many practical, and all richly illustrated. They have inspired many ideas that I've applied in practice, and in my own teaching.

Mary G., Urban Planner

Get top-rated, practical training

Historic homes in St. Augustine, Florida.

Florida Considers Legalizing ADUs

Current state law allows — but doesn’t require — cities to permit accessory dwelling units in single-family residential neighborhoods.

March 18, 2025 - Newsweek

Aerial view of suburban housing near Las Vegas, Nevada.

HUD Announces Plan to Build Housing on Public Lands

The agency will identify federally owned parcels appropriate for housing development and streamline the regulatory process to lease or transfer land to housing authorities and nonprofit developers.

March 17, 2025 - The Wall Street Journal

Canadian flag in foreground with blurred Canadian Parliament building in background in Ottawa, Ontario, Canada.

Has President Trump Met His Match?

Doug Ford, the no-nonsense premier of Canada's most populous province, Ontario, is taking on Trump where it hurts — making American energy more expensive.

March 11, 2025 - Toronto Star

White bike symbol painted on green bike lane.

OKC Approves 7.2 Miles of New Bike Lanes

The city council is implementing its BikeWalkOKC plan, which recommends new bike lanes on key east-west corridors.

March 21 - Oklahoma City Free Press

Aerial view of downtown Houston, Texas skyline with low-rise housing in foreground.

Preserving Houston’s ‘Naturally Occurring Affordable Housing’

Unsubsidized, low-cost rental housing is a significant source of affordable housing for Houston households, but the supply is declining as units fall into disrepair or are redeveloped into more expensive units.

March 21 - Urban Edge

Small tree in bloom with pink flowers in front of home in Toronto, Canada.

The Most Popular Tree on Google?

Meet Rodney: the Toronto tree getting rave reviews.

March 21 - Toronto Star