The PBS News Hour broadcast an important two-part series this week about the continued challenges facing African Americans when they seek to obtain a mortgage to buy a home (see Part 1 and Part 2). The story highlights that racial disparities between African Americans and whites remain extraordinarily high and that outright discrimination continues. The story highlights the issues facing African American homeowners seeking home equity loans to fix their homes and the fact that lenders seem to prefer lending to upper-income whites moving into low-income areas as they do for lending to moderate-income African Americans who already live there. The story highlights the potential for the Trump Administration to make changes to the Community Reinvestment Act – changes that are likely to make things worse, not better. U.S. Senator Tim Scott (R-SC) points out the industry’s heavy reliance on credit scores has an unfair and disproportionately negative impact on African Americans.
The Mel King Institute and the Massachusetts Community Banking Council recently co-hosted an Innovation Forum event to highlight a new report that documents similar patterns here in Massachusetts. This is a problem that is getting worse and requires a significant response from local, state and federal government. Indeed, the need to address homeownership for low and moderate-income families, in particular families of color, is emerging as a major agenda item in MACDC’s strategic planning process. More on that to come later.