Black and Hispanic borrowers were denied approval for mortgages at a considerably higher rate than non-Hispanic White and Asian borrowers in 2019, according to a report released by the Consumer Financial Protection Bureau.
The report found that 16 percent of would-be Black and 10.8 percent of Hispanic borrowers were denied for conventional home-purchase loans last year, compared to 8.6 percent of Asian and 6.1 percent of white borrowers.
“When people of color are stuck in this cycle of renting, their children often meet the same fate, missing out on thousands of dollars worth of home equity,” said Brittani Walker, a Redfin agent in Chicago. “If your parents never owned a home, where do you learn the value of homeownership?”
A Redfin analysis of the data found that the gap was especially wide in Milwaukee, San Francisco, Detroit, Chicago and St. Louis.
In Milwaukee, 19.5 percent of Black mortgage applicants are rejected, compared with just 4.8 percent of white applicants. San Francisco had the second largest gap (19.2 percent to 5.9 percent, followed by Detroit (20.3 percent to 7.2 percent), Chicago (18.5 percent vs 5.7 percent) and St. Louis (18.1 percent vs 5.6 percent).
“The residue of redlining is still very tangible in Milwaukee and Chicago,” said Arnell Brady, a Redfin Mortgage adviser who represents both cities. “Segregation continues to perpetuate the uneven playing field for Black communities, which are severely underserved when it comes to financial education and access to credit. Buying a home isn’t like walking into a bank and getting a credit card. Everyone wants a piece of the American dream, but that’s hard to achieve when you don’t have access to the right tools and information.”
Meanwhile, the metropolitan area with the smallest gap is San Diego, where 10.8 percent of Black mortgage applicants are rejected, compared with 7.3 percent of white applicants. Seattle was second (10 percent to 5.2 percent), followed by Sacramento (11.2 percent to 6.2 percent), Anaheim (13.2 percent to 8.1 percent) and Las Vegas (13.7 percent vs 8.1 percent).
| Mortgage Denial Rate | Median Property Value on Originated Loans | |
|---|---|---|
| Milwaukee, WI | ||
| Black | 19.5% | $135,000 |
| White | 4.8% | $265,000 |
| San Francisco, CA | ||
| Black | 19.2% | $1,125,000 |
| White | 5.9% | $1,475,000 |
| Detroit, MI | ||
| Black | 20.3% | $125,000 |
| White | 7.2% | $175,000 |
| Chicago, IL | ||
| Black | 18.5% | $195,000 |
| White | 5.7% | $295,000 |
| St. Louis, MO | ||
| Black | 18.1% | $145,000 |
| White | 5.6% | $215,000 |
| Newark, NJ | ||
| Black | 18.9% | $305,000 |
| White | 6.8% | $415,000 |
| Philadelphia, PA | ||
| Black | 16.8% | $165,000 |
| White | 5.9% | $295,000 |
| Cleveland, OH | ||
| Black | 16.2% | $115,000 |
| White | 5.5% | $185,000 |
| San Jose, CA | ||
| Black | 16.4% | $775,000 |
| White | 6.4% | $1,065,000 |
| Houston, TX | ||
| Black | 16.8% | $245,000 |
| White | 7.0% | $295,000 |
| Atlanta, GA | ||
| Black | 16.6% | $225,000 |
| White | 6.9% | $295,000 |
| Dallas, TX | ||
| Black | 15.3% | $265,000 |
| White | 5.8% | $335,000 |
| Boston, MA | ||
| Black | 14.7% | $385,000 |
| White | 5.3% | $505,000 |
| Cincinnati, OH | ||
| Black | 15.5% | $155,000 |
| White | 6.1% | $215,000 |
| Indianapolis, IN | ||
| Black | 14.6% | $185,000 |
| White | 5.2% | $225,000 |
| Pittsburgh, PA | ||
| Black | 15.7% | $135,000 |
| White | 6.5% | $195,000 |
| Washington, D.C. | ||
| Black | 13.2% | $365,000 |
| White | 4.1% | $475,000 |
| New York, NY | ||
| Black | 17.5% | $495,000 |
| White | 8.8% | $575,000 |
| Warren, MI | ||
| Black | 14.7% | $175,000 |
| White | 6.0% | $235,000 |
| Orlando, FL | ||
| Black | 16.8% | $255,000 |
| White | 8.2% | $295,000 |
| Providence, RI | ||
| Black | 15.1% | $275,000 |
| White | 6.9% | $305,000 |
| Nashville, TN | ||
| Black | 14.1% | $265,000 |
| White | 5.9% | $315,000 |
| Austin, TX | ||
| Black | 14.3% | $275,000 |
| White | 6.3% | $345,000 |
| Fort Worth, TX | ||
| Black | 13.8% | $245,000 |
| White | 5.8% | $275,000 |
| Tampa, FL | ||
| Black | 16.4% | $225,000 |
| White | 8.4% | $255,000 |
| Baltimore, MD | ||
| Black | 13.0% | $265,000 |
| White | 5.0% | $345,000 |
| Nassau County, NY | ||
| Black | 15.1% | $425,000 |
| White | 7.2% | $485,000 |
| Kansas City, MO | ||
| Black | 12.8% | $185,000 |
| White | 5.0% | $245,000 |
| Los Angeles, CA | ||
| Black | 16.6% | $505,000 |
| White | 8.8% | $755,000 |
| New Brunswick, NJ | ||
| Black | 15.1% | $325,000 |
| White | 7.5% | $355,000 |
| Charlotte, NC | ||
| Black | 13.5% | $235,000 |
| White | 6.0% | $295,000 |
| Oakland, CA | ||
| Black | 12.8% | $555,000 |
| White | 5.3% | $775,000 |
| San Antonio, TX | ||
| Black | 13.9% | $245,000 |
| White | 6.6% | $265,000 |
| West Palm Beach, FL | ||
| Black | 17.2% | $265,000 |
| White | 9.9% | $355,000 |
| Jacksonville, FL | ||
| Black | 15.8% | $225,000 |
| White | 8.5% | $275,000 |
| Phoenix, AZ | ||
| Black | 13.6% | $255,000 |
| White | 6.4% | $315,000 |
| Minneapolis, MN | ||
| Black | 11.2% | $255,000 |
| White | 4.0% | $295,000 |
| Columbus, OH | ||
| Black | 12.9% | $185,000 |
| White | 5.9% | $245,000 |
| Montgomery County, PA | ||
| Black | 12.1% | $275,000 |
| White | 5.2% | $335,000 |
| Riverside, CA | ||
| Black | 14.1% | $375,000 |
| White | 7.5% | $405,000 |
| Portland, OR | ||
| Black | 11.5% | $365,000 |
| White | 4.9% | $405,000 |
| Denver, CO | ||
| Black | 11.8% | $365,000 |
| White | 5.2% | $445,000 |
| Miami, FL | ||
| Black | 23.2% | $275,000 |
| White | 16.6% | $415,000 |
| Virginia Beach, VA | ||
| Black | 10.9% | $225,000 |
| White | 4.5% | $275,000 |
| Fort Lauderdale, FL | ||
| Black | 18.6% | $275,000 |
| White | 12.2% | $365,000 |
| Las Vegas, NV | ||
| Black | 13.7% | $295,000 |
| White | 8.1% | $325,000 |
| Anaheim, CA | ||
| Black | 13.2% | $650,000 |
| White | 8.1% | $775,000 |
| Sacramento, CA | ||
| Black | 11.2% | $355,000 |
| White | 6.2% | $445,000 |
| Seattle, WA | ||
| Black | 10.0% | $455,000 |
| White | 5.2% | $555,000 |
| San Diego, CA | ||
| Black | 10.8% | $495,000 |
| White | 7.3% | $635,000 |
See the full report here.