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Mortgage defaults by race11/12/2023 ![]() ![]() But it does collect a huge amount of information by race on mortgages handed out, in order to encourage lending to minorities by threatening lawsuits against financial institutions accused of discriminating against them. “In order to get more opportunity, you need to go to college but you need more debt to make that happen. The federal government doesnt make it easy for citizens to find information on mortgage defaults and foreclosures by race. “How do we ever get out of this cycle?” Ashley Harrington, senior policy counsel for the Center for Responsible Lending, told Reuters in an interview on Wednesday. This chapter places the current study in the context of recent analyses of race, default risk, and mortgage lending. Those smaller paychecks, combined with the larger debt loads, make it harder for students of color to buy homes or make other investments that could help them accumulate wealth. For instance, black and Hispanic workers tend to be paid less than their white peers. Those higher debt loads help to perpetuate the racial wealth gap. Students of color often need to borrow more money to pay for college because their families have less wealth to draw on to help cover those costs, according to a report released in September by the Center for Responsible Lending. Other studies have found that the higher rates of borrowing among African American and Hispanic students are linked to longstanding racial disparities in income and wealth. Publication of the aggregate data from the National Mortgage Database (NMDB®) is a step towards implementing the statutory requirements of section 1324 (c) of the Federal Housing Enterprises Financial Safety and Soundness Act of 1992, as amended by the Housing and Economic Recovery Act of 2008. Higher borrowing rates in black neighborhoods could be explained by differences in income, with people from lower-income households being more likely to need loans to pay for school, the researchers wrote. National Mortgage Database Aggregate Data. Since lenders who discriminate require higher standards. “But high delinquency rates suggest that the high borrowing rates may not be paying off immediately for all borrowers, particularly if their income remains insufficient to maintain current status on their debt service payments.” New Evidence on the Relationship Between Race and Mortgage Default: The Importance of Credit History Data Cotterman, Robert F, U S Dept of Housing and. Some scholars argue that racial discrimination in mortgage lending can be observed in default rates. “The federal student loan program aims to ‘make college education possible for every dedicated mind,’” the researchers wrote in a blog post published Wednesday. REUTERS/Rebecca Cookīorrowers from black neighborhoods also tend to carry larger debt loads, the data showed.įed researchers found that people in black-majority neighborhoods were slightly more likely to borrow for college, with 23% of residents carrying student loans, compared to 17% of people in Hispanic-majority neighborhoods and 14% in white-majority zip codes. FILE PHOTO: Students walk on campus at the University of Michigan in Ann Arbor, Michigan, U.S., September 20, 2018.
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