Banking While Black?

The following article appeared in The New Pittsburgh Courier the week of March 18, 2009.

NAACP says lending institutions discriminated, forced Blacks into subprime mortgages

(NNPA)---The National Association for the Advancement of Colored People is accusing Wells Fargo and HSBC of forcing Blacks into subprime mortgages while Whites with identical qualifications got lower rates.
Class-action lawsuits were filed against the banks March 13 in federal court in Los Angeles, said Austin Tighe, co-lead counsel for the NAACP, in a statement released by the civil rights organization. It states: “These lawsuits allege systematic, institutionalized racism in subprime home mortgage lending. Said Tighe, “Black homebuyers have been 3-1/2 times more likely to receive a subprime loan than White borrowers, and six times more likely to get a subprime rate when refinancing. Blacks still were disproportionately steered into subprime loans when their credit scores, income and down payment were equal to those of White homebuyers.”
Both Wells Fargo & Co. and HSBC are receiving federal bailout funds.

Similar NAACP lawsuits are pending against a dozen other subprime lenders.
“This is systematic, institutionalized racism,” Tighe said. “Once you take out factors relative to income and credit risk, the only difference between the borrowers is the color of their skin.”
Tighe estimated that “tens of thousands” of Blacks had been forced into bad loans but said it was difficult to gauge the scope of the problem because banks keep much of their internal data private. The lawsuits could force banks to divulge closely guarded information, such as how banks can determine the race of a loan applicant and how federal bailout funds are being spent.
The NAACP is seeking reforms from banks such as increased transparency in the loan process, educational outreach and internal training.

Information from the Associated Press contributed to this report.
(Special to the NNPA from the St. Louis American.)

Blogger Black Buzz says that Caucasian people and other non-Black people in the home mortgage lending and banking industry made discriminatory decisions by treating African American applicants differently under like or similar circumstances as Caucasian applicants. Therefore, the NAACP should not be seeking to reform the behavior of the bigoted personnel from the top CEO’s to the individual mortgage specialist/representatives who discriminated against Black applicants in the systems of acquiring home mortgages. Where there is clear evidence of disparate treatment in Blacks acquiring home loans or mortgages, those actors need to be fired or terminated. Let the unbiased clergy members deal with the racists.
We should always remember when one has racial or ethnic prejudice plus a degree of real power in which their decisions or actions result in treating various protected classes of people differently under same or like conditions, this cowardly behavior equals pure unadulterated racism.
Prejudice + power= racism.

For the past eight years, the U.S. Justice Department Civil Rights Division, HUD, the FBI and other agencies that have regulatory statutory authority over the home loan mortgage industry have been doing absolutely nothing relative to enforcing the law and insuring that applicants are treated fairly without regards to race, color, national origin, ancestry, age, sex, religion, disability and veterans status. Will the U.S. Justice Department under Eric Holder’s leadership and HUD, directed by Shaun Donovan, continue to have this very cavalier, laissez faire attitude towards African Americans in treating them as second class citizens in a country that they built?