HMDA Data Offers Clues on Discrimination Against Gays

June 10, 2014
American Banker 
mortgage lending news
Home Mortgage Disclosure Act data show that denials were down in all categories for male and female same-sex borrowers in 2012, but the rate was still higher for same-sex couples than for mixed-sex couples with a male as the primary applicant. Analyses by the Federal Reserve and ComplianceTech indicate that even though denial rates for same-sex couples were lower than denials for one-person applicants of either gender, two-male couples were denied at about the same rate as mixed-sex couples with a female as the primary applicant.

The Fed report shows that denials for same-sex applicants were down in conventional and non-conventional purchase and refinance loans. The denial rate fell to 21.7 percent for male same-sex couples from 24.5 percent in 2011 and to 20 percent for female same-sex couples from 24 percent for conventional refis, while denial rates for non-conventional refis dropped to 22 percent from 31 percent for male couples and 21.7 percent from 33.3 percent for female couples. Denials for conventional purchase mortgages dropped 150 basis points to 17.2 percent for male couples and to 16.2 percent from 18.5 percent for female couples.

Observers consider the analyses intriguing, though the same-sex couples covered by the data may simply be relatives or business partners and not gay or lesbian couples. The data also does not indicate how much prejudice there is against LGBT mortgage applicants.

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