Homeownership is the primary means of long-term wealth accumulation and financial security for most American families, and plays an important role in promoting neighborhood stability and civic engagement. However, the opportunities of homeownership remain beyond the reach of many low- and moderate-income (LMI) households. Minority households face additional barriers. Even today, three decades after the elimination of racial segregation and the passage of fair housing legislation, African American and Hispanic borrowers are at least twice as likely as non-Hispanic whites to be turned down for a mortgage. An enormous body of research now documents these disparities in lending patterns. Unfortunately, most of this research is designed to uncover the problem
of a continued legacy of discrimination, differential treatment, or disparate impact, and provides little insight on alternative solutions
This study analyzes successful strategies to extend mortgage lending to minority home seekers, particularly those with low or moderate incomes. Mortgage lending practices and marketing strategies used to attract, qualify, and retain minority-LMI applicants are identified and analyzed based on telephone discussions, quantitative analyses, and case studies.