Twenty Percent Down-payment Sanctions Unequal & Separate Lending

Unequal & Separate Lending System Between The Rich & Everyone Else, Throws Gas On Fire Undermining American Economy

Washington, DC — John Taylor, president & CEO of the National Community Reinvestment Coalition (NCRC), released this statement at a press conference with U.S. Senators Johnny Isakson, Kay Hagan, and Mary Landrieu and U.S. Congressmen John Campbell and Brad Sherman on Capitol Hill about the Qualified Residential Mortgage (QRM) rule.

“The end of the American Dream as we know it may be near for millions of working families across country. We are on the precipice of witnessing one of the most damaging regulatory developments in decades.

“At a time when our economy is fragile and our housing values have plummeted along come the regulatory agencies with a solution that will limit access to mortgages for millions of families. The QRM proposal throws gasoline on the fire that continues to undermine the American economy.

“The regulators who failed to reign abusive lending practices will now be sanctioning an unequal and separate lending system in which the wealthy will receive the most affordable loans while everyone else will be charged higher prices and face much more stringent standards. This is simply unacceptable. And, there is no indication that building such a restrictive mortgage lending system is necessary.

“The financial crisis was caused by risky, non-traditional subprime lending that didn’t require income documentation. It was not caused by prime lending with low down payments. In fact, a forthcoming study conducted by NCRC found little correlation between the size of down payment and default rates. After analyzing nearly one million loans written for the most creditworthy borrowers in 2006 and 2007, the different in defaults between 20% down and 3% was insignificant and not a margin of difference worthy of such hysteria.

“If regulators move forward with the current plan, it will block homeownership for millions of Americans, who will find themselves being punished for the mere fact that they are not wealthy.”


About the National Community Reinvestment Coalition (NCRC):
The National Community Reinvestment Coalition is an association of more than 600 community-based organizations that promote access to basic banking services, including credit and savings, to create and sustain affordable housing, job development, and vibrant communities for America’s working families.  


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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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