American Banker: Will HMDA data carve-out for small banks make discrimination easier?

American Banker, March 13, 2018: Will HMDA data carve-out for small banks make discrimination easier?

As critics of the Senate banking bill have rallied in recent weeks, an important argument has begun to gain traction: The legislation would make it easier for banks to discriminate.

The Senate bill calls for exempting banks and credit unions that provide fewer than 500 mortgages a year from having to report on a series of expanded data points required by the Home Mortgage Disclosure Act.

“Credit scores, the loan-to-value ratio, how long the prepayment penalty is — all of these things and more could give a clearer picture,” said John Taylor, president and CEO of the National Community Reinvestment Coalition.

“This isn’t a bill to reduce regulatory burden, this is a bank bill that allows them to continue to hide the data from the public,” said Taylor. “We are seeing a wholesale withdrawal by this administration, away from making homeownership available to working-class Americans.”

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Redlining and Neighborhood Health

Before the pandemic devastated minority communities, banks and government officials starved them of capital.

Lower-income and minority neighborhoods that were intentionally cut off from lending and investment decades ago today suffer not only from reduced wealth and greater poverty, but from lower life expectancy and higher prevalence of chronic diseases that are risk factors for poor outcomes from COVID-19, a new study shows.

The new study, from the National Community Reinvestment Coalition (NCRC) with researchers from the University of Wisconsin–Milwaukee Joseph J. Zilber School of Public Health and the University of Richmond’s Digital Scholarship Lab, compared 1930’s maps of government-sanctioned lending discrimination zones with current census and public health data.

Table of Content

  • Executive Summary
  • Introduction
  • Redlining, the HOLC Maps and Segregation
  • Segregation, Public Health and COVID-19
  • Methods
  • Results
  • Discussion
  • Conclusion and Policy Recommendations
  • Citations
  • Appendix

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