Fingerlakes1.com, January 19, 2022, Low to moderate income families, people of color excluded from mortgage market
The mortgage industry has been in overdrive since the COVID-19 pandemic began in 2020, but low- to moderate-income families and people of color have not benefited from the plummeting interest rates overall.
The explosion of refinance lending reinforced historical patterns of disinvestment in lower-income and Black, Indigenous and People of Color communities, according to a new report from The National Community Reinvestment Coalition (NCRC).
NCRC analyzed Home Mortgage Disclosure Act (HMDA) data collected from lenders by the Consumer Financial Protection Bureau (CFPB). The data includes records for 88% of all mortgage applications taken by lenders and offers a snapshot of the race, ethnicity, gender, age and location of those applications.
“The gap in homeownership between Black and White households has remained almost unchanged for 120 years,” said Jason Richardson, NCRC’s senior director of research and evaluation and one of the authors of the report. “Today that gap remains near an all-time high. This drives a massive gap in wealth between homeowners and renters that grows larger with each passing year.”
NCRC has called for a 60% homeownership rate for communities traditionally excluded from homeownership. They state that policy makers, community leaders, and lenders themselves should rally around bold new approaches, race-specific metrics and performance requirements to bridge the wealth gap and help all American families have the chance to be homeowners and build wealth for themselves and their children.
