Progress Ohio | Dave Harding's Blog: Racial & Ethnic Disparities ...

by Dave Harding, ProgressOhio

Cleveland Region Shows Greatest Disparities in Subprime Lending

African Americans and Hispanics/Latinos in Ohio were denied mortgage loans more often than whites in 2008 and, when they did obtain loans, were more likely to receive high-cost subprime loans than whites, according to a new report by the Cleveland-based Housing Research &  Advocacy Center utilizing recently-released home mortgage lending data. High-cost lending also reveals racial and ethnic disparities.  Statewide, upper income African Americans received high-cost home purchase loans at a slightly lower rate than low income whites but received high-cost refinance loans at nearly the same rate as low income whites.  Hispanics/Latinos typically received more high-cost loans than whites but fewer than African Americans.  Asians had the lowest incidence of high-cost lending for all groups studied. Jeffrey D. Dillman, Executive Director of the Housing Center, stated, “Although the amount of lending overall has decreased substantially over the past four years, racial and ethnic disparities continue throughout the state.  Not only do African Americans and Latinos have a harder time getting approved for a loan, but once they get a loan, they wind up with high-cost subprime loans more often than whites even when they have higher incomes.” The Housing Research & Advocacy Center’s report, entitled “Racial and Ethnic Disparities in 2008 Ohio Mortgage Lending,” analyzes 2008 home mortgage lending data (the most recent available) statewide and in Ohio’s seven largest metropolitan areas – Akron, Cincinnati, Cleveland, Columbus, Dayton, Toledo, and Youngstown.  This report follows three similar reports by the Housing Center which specifically examined the racial and ethnic disparities in Ohio Mortgage Lending by analyzing 2005, 2006, and 2007 home mortgage lending data. Statewide, the overall amount of mortgage lending decreased significantly over the last four years, from 1.16 million loan records reported in 2005 to 533,639 in 2008, a 54.00% decrease.  While members of all racial groups received fewer loans, the 2008 data reveal continuing disparities in mortgage lending in Ohio based on both race and ethnicity.

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