African Americans Targeted for Subprime Loans
The study is called "Pathways to Foreclosure" and it found that African American families follow such paths more often than whites of similar income levels. Study author Claudia Coulton says the trend cuts across all economic groups. Despite years of progress in making housing loans fair for minorities, Coulton says the current spate of foreclosures harkens back to problems of forty years ago.
COULTON: The Home Mortgage Disclosure Act which has been very important in getting fair credit to various groups who were excluded in the past --- people of color, in particular --- that was really about controlling loan denial and, in the meantime, we have had a whole series of new loan products that were not even available when that law was passed, and it seems like that's the current "redlining", if you will.
Coulton says local banks are a good option for new homeowners looking to navigate the currently treacherous waters of home financing.