OpinionIndustry News

Spotlight on real estate loan discrimination

Perspective: Probe of unexplained disparities in home loans long overdue

Learn the New Luxury Playbook at Luxury Connect | October 18-19 at the Beverly Hills Hotel

Federal regulatory agencies deserve a long and hearty round of applause for their decision to launch a long overdue investigation into possible cases of racial discrimination in mortgage lending. The Federal Reserve and U.S. Department of Housing and Urban Development are among the agencies involved in the effort, which comes on the heels of the Fed's analysis of 2004 data collected from lenders pursuant to federal law. The Fed's analysis found that such factors as loan price, property location and income level couldn't fully explain certain patterns of higher mortgage interest rates being paid by African American and Hispanic borrowers. Numerous other studies over the years also have found unexplained disparities in the types of loans originated to minority borrowers. Whether individual, corporate or systemic racial discrimination accounts for the disparities in the data isn't known, but the possibility is well worth a closer look to find out. If further investigation demonstrates...