Comments on: Charlottesville MSA apparently is a risky place to get a loan if you’re a minority

By: Friday Links - 03 April 2009 | Real Central VA

Friday Links - 03 April 2009 | Real Central VA — Fri, 03 Apr 2009 12:00:42 +0000

[...] points to a new NY Fed study that demonstrates out that reverse redlining may be a sham (remember this story from last year?) This is important: whatever you know or don’t know about research, the garbage-in, garbage-out [...]

By: UVA08

UVA08 — Fri, 13 Jul 2007 20:18:05 +0000

Some lenders are pointing out the fact that minorities may have less assets and wealth which may also contribute to the correlation we see. This only brings us to the question of why there is still this disparity between blacks and whites in terms of wealth and assets. Are we to believe it is solely due to personal characteristics like being willing to work hard, morals, and upbringing or are there deeper historical roots for this problem? This, of course, takes us out of a discussion on real estate and into one that deals with a very sensitive subject for most Americans. I believe there is some writing on this subject by authors by the name of Oliver and Shapiro.

By: Joel

Joel — Fri, 13 Jul 2007 19:52:21 +0000

Jim you’re not alone, my first presidential campaign contribution ever was also to Ron Paul, last month!

By the way, love the blog. It’s good to see honest realtors like yourself succeed in the business.

By: Jim Duncan

Jim Duncan — Fri, 13 Jul 2007 18:25:33 +0000

Joel -

Thank you for stopping by.

I agree with you and probably should not have written that. The data is incomplete and should be released for public scrutiny.

I should have left my comments at “we need to compare apples to apples.”

Thank you for pointing out my poor logic.

–
Incidentally, I just donated to a presidential campaign for the first time yesterday, for Dr. Ron Paul.

By: Joel

Joel — Fri, 13 Jul 2007 18:19:16 +0000

I’m questioning your statement that “no doubt there is discrimination happening.” The only thing there’s “no doubt” about is that we have pretty useless data. Without knowing the detailed credit characteristics of the borrowers in question, we can’t come close to drawing a conclusion about discrimination.

Let’s assume that, after controlling for income levels, the minority borrowers have on average lower-quality credit metrics. Then it’s totally reasonable to expect that out-of-state lenders specializing in high-risk lending would target those borrowers. Minority status may be correlated to these disparate outcomes, but not necessarily the cause of outcomes.

By: Jim Duncan

Jim Duncan — Fri, 13 Jul 2007 16:10:25 +0000

Two questions –

1) Did they just get aggregated, non-lender-specific data, or do they know which lenders are the violators?
2) Will they disclose the violators?

By: Jalane Schmidt

Jalane Schmidt — Fri, 13 Jul 2007 09:29:53 +0000

Not enough folks in the financial and real estate industries involved are willing to look at issues of racism. Thanks for running this story, Jim.

By: Jim Duncan

Jim Duncan — Fri, 13 Jul 2007 02:38:49 +0000

I agree, but it would be a heck of a demonstration for a company to take in light of what may very well be a deserved firestorm.

By: Waldo Jaquith

Waldo Jaquith — Thu, 12 Jul 2007 17:04:06 +0000

Pull the files from the top three local banks (or more), and compare apples to apples on applications – credit scores, income, debt ratios, the whole thing, and report those findings.

That’s a great idea. I can’t imagine that many (any) banks would be game for opening up files like that, even with all personally-identifying information redacted, but it’d be great if they were.