A study just completed by the Center for Responsible Lending concluded that African-Americans and Latinos often end up with high-interest sub-prime loans, much more often than Whites do. The qualifications do not always matter, quite often both groups will have the same information, but the white consumer will still receive the better loan.
Lenders claim the shakier credit histories of the minorities for the differences. The Center claims that this just isn’t true. After examining 50,000 sub-prime loans, the Center still found that even though everyone in the group had the same credit profile, they were still a third more likely to get a higher priced loan.
This not only discourages minorities from getting a loan, but makes it downright impossible for many of them. "When African-American and Latino families are steered into higher-cost loans, this path to security is made steeper," said Hilary Shelton, director of the Washington bureau of the NAACP, the lobbying and public policy branch of the civil rights group. "That means that it's even harder for families of color to build equity for their future; it's even harder to send their children to college; and it's even harder to build wealth for the next generation.” ■
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