AlyssaKatz.com

Denial

The new Pew Hispanic Center report on minority homeownership shows (with the help of the indispensable Home Mortgage Disclosure Act) what black and Latino buyers are now up against in the post-subprime era: home purchase mortgage application denial rates of 26 (Latino) and 30 (black) percent, compared with 12 percent for white borrowers. And that was in 2007; the 2008 and 2009 numbers stand to be much worse. Right now black homeownership stands at 49 percent and Latino 47, compared with 75 percent for whites.

So, what happens now? What’s the successor to subprime…and if there isn’t one, what will aspiring homebuyers do when they’re rejected for mortgages? The common answer right now is “rent,” and I’m all in favor of that, but that means accepting a future of two nations, owner and renter, divided not just by ownership, but by race. That’s nothing new, but follows years of intensive efforts by Fannie Mae, the Ford Foundation, HUD, the lending industry and many many others to narrow the gap — a gap that’s now threatening to widen again.

May 13th, 2009 | Tags: Home Mortgage Disclosure Act, race, subprime
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