Locked Out Of The Market: Poor Access To Home Loans For Californians Of Color

The pace of recovery following the foreclosure and financial crises continues to differ across racial and ethnic groups. This is especially clear across mortgage lending in California. Banks, lenders, and policymakers must understand this phenomenon and create better products and policies to address this gaping problem. Decades of discriminatory practices by mortgage lenders, known as “redlining,” produced a shameful legacy that still all too frequently determines who gets access to America’s central vehicle for wealth creation: homeownership. As a result, people of color continue to experience far lower rates of homeownership than whites and the benefits of homeownership rarely trickle down to our nation’s fastest growing demographic. People of color will account for the vast majority of household growth in the U.S. for the next 40 years, yet our housing policy fails to accommodate this growth. Inadequate access to sustainable mortgage lending dims prospects of a bright economic future. Eliminating barriers to access these loans can ensure that our housing market nurtures wealth creation for all Americans.