Income is No Shield Against Racial Differences in Lending: A Comparison of High-Cost Lending in America’s Metropolitan Areas (PDF; 258 KB)
Source: National Community Reinvestment Coalition
From press release (PDF; 339 KB):

A looming “perfect storm” of foreclosures confronts Americans as up to 2 million adjustable rate mortgages with low “teaser” rates will adjust upward to much higher interest rates over the next 18 months.

Against the backdrop of risky high-cost lending practices are striking racial disparities, finds NCRC’s most recent study, Income is No Shield against Racial Differences in Lending: A Comparison of High-Cost Lending in America’s Metropolitan Areas, released today. The report is a comprehensive study of every major metropolitan area in the country.

Minorities are at the greatest risk of receiving poorly underwritten, high-cost loans, the study finds. Middle- or upper-income levels do not shield minorities from receiving dangerous high-cost loans.

NCRC observes that racial differences in lending increase as income levels increase. For example, in 167 metropolitan areas, middle- and upper-income (MUI) African-Americans were found to be twice as likely or more than twice as likely than MUI whites to receive high-cost loans. In contrast, low- and moderate-income (LMI) African-Americans were twice or more likely than LMI whites to receive high-cost loans in just 70 metropolitan areas.

This entry was posted on Thursday, July 12th, 2007 at 7:54 am and is filed under Business and economics, Consumer issues, Ethnic, Housing and real estate, Race, Social and cultural issues. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.