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Daily Real Estate News  |  April 28, 2011  |   Study: Refinances Tougher to Get for Minorities
Following the housing crash, home mortgages refinances seem to be easier and more readily available in predominantly white areas of major U.S. cities than in minority areas. That was the conclusion of research compiled by a coalition of nonprofit groups across the country, including the California Reinvestment, the Woodstock Institute in Chicago, and the Ohio Fair Lending Coalition.

In the study, researchers found that in seven major cities Boston, Charlotte, Chicago, Cleveland, Los Angeles, New York City, and Rochester, N.Y. conventional mortgage refinancing in minority areas decreased by 17, on average, in 2009 compared with the previous year.

Yet, in predominantly white neighborhoods, mortgage refinancing loans increased by 129 percent, on average.

Researchers also found that lenders "were more than twice as likely" to deny refinancing applications by borrowers in minority communities than in majority white communities.

"These findings build on our past reports, which have documented ongoing racial disparities in mortgage lending," says Adam Rust, director of research at the Community Reinvestment Association of North Carolina. "Lenders are loosening up credit in predominantly white neighborhoods, while continuing to deprive communities of color of vital refinancing needed to aid in their economic recovery."

In its previous studies, the coalition found that minority borrowers, even who had good credit, were more likely to obtain high-risk subprime loans than white Americans during the housing boom.

Source: “Post-Crash, Mortgages Scarce for U.S. Minorities,” Reuters News (April 28, 2011)

More resources:

Quiz: Fair Housing

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