The New Redlining

"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."