Fed Reports Disparity in Area Lending: Blacks, Hispanics Rejected More Often Than Whites
Blacks and Hispanics in the Washington area were at least twice as likely as whites to be denied mortgage credit by local lenders in 1993, according to data released this week by the Federal Reserve.</br></br>However, loan applicants of all races throughout the area were less likely to be denied credit than were applicants in the country as a whole, the Fed reported.</br></br>ÛÏWe're severely disappointed in the new numbers,Û said John Taylor, president and chief executive of the National Community Reinvestment Coalition, a District-based group that monitors lending in poor communities. Banks have said for at least two years that they are stepping up minority lending, Taylor said, and "this was the year that we should have seen an appreciable difference.Û</br></br>In the metropolitan area, which includes several Maryland counties and extends south to Prince William County, 14.2 percent of blacks and 9.4 percent of Hispanics were denied mortgages, compared with 5 percent of whites. Lending rates for individual institutions were not disclosed.</br></br>Stephen S. Fuller, a George Mason University professor who writes a monthly report on the Washington area economy, said the difference in denial rates is "partly explained by educational level, and that educational level affects the income, or career, or job type that a population seems to be characterized by." ÛÏItÛªs very dangerous to generalize like this,Û Û¢ Fuller added, but "there are some legitimate reasons for these differences. . .. The question is, are those [reasons] sufficient to explain the magnitude of the differences described, and the answer is no,Û he said.