The New Face of Housing Discrimination

Housing Watch
August 26, 2010
Curry, Sheree R.

According to a study recently released by the Center for Responsible Lending (CRL), African-American and Latino homeowners have a disproportionate share of foreclosures nationwide compared with their percentage of homeownership. In Chicago, for example, African Americans make up 26 percent of the National Foreclosure Mitigation Counseling Program and Latinos account for 21 percent of the same initiative -- even though these demographics represent just 9 percent and 8 percent of U.S. homeowners. Some experts say the discrimination is simply an extension of the days when minorities could not get loans or buy in certain neighborhoods. Now, however, Latinos and blacks are getting loans -- but at much higher rates than what white borrowers are paying. The CRL study found that Latino and African-American families disproportionately received the most expensive and riskiest types of loans during the subprime lending boom, which also means these groups have needed the most help. However, many banks are unwilling to help minorities with refinancing unless a nonprofit counseling agency intervenes on their behalf. There are steps homeowners can take to prevent becoming a victim of housing discrimination: knowing the true cost of their loan, avoiding adjustable interest rates that involve deceptive teaser rates, understanding all the paperwork they sign and asking for explanations if they do not, and avoiding scams by seeking help from a non-profit credit counselor.
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