MORTGAGE LENDING AND RACE - IS DISCRIMINATION STILL A FACTOR

The significance of race in mortgage lending has emerged as a major pu blic policy issue and focus of scholarly research in the United States . In this paper the experiences of black and Latino mortgage loan appl icants in a large midwestern metropolitan area are examined by means o f a database on the disposition of individual mortgage loan applicatio ns that is now available. It is found that, after controlling for inco me, age of housing, housing value, and occupancy status, black applica nts and applicants from predominantly black communities are less likel y to have their loan applications approved than are white applicants o r applicants from predominantly white areas. Although no disparities w ere associated with Latino applicants, those applicants from predomina ntly Latino communities were less likely to be approved than were othe rs. Specific research and policy recommendations are offered to develo p a further understanding of the racial implications of the mortgage m arket and for reducing racial disparities in accessing credit for home purchases.