In Houston, Black Mortgage Applicants Denied Two Times the Rate of White Applicants

by Peter Thomas Ricci

Minority groups have a harder time accessing mortgages in the U.S., including here in Houston.


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In the Houston metro area, 19.6 percent of African-Americans are denied in their applications for conventional mortgages, according to a new analysis from Zillow; that’s more than two times the 7.6 percent denial rate for white applicants.

To be fair, the national averages were not any more encouraging. Of all applicants, the denial rate was 12.4 percent for conventional loans, but while the denial rate fell for white applicants to 10.4 percent, it rose for both Hispanic and African American applicants to 21.9 and 27.6 percent, respectively.

“Strikingly Unequal” Housing Behind Denial Rates

Stan Humphries, the chief economist at Zillow, said that a stark inequality is behind the aforementioned stats.

“While many of the disparities between the experiences of white communities and minority communities during the housing boom and bust can be explained by plain differences in finances and geography, it’s clear that the housing playing field remains strikingly unequal in this country,” Humphries said.

The key economic trends, Humphries stated, are twofold: first, both Hispanic and African American mortgage applicants make roughly $20,000 less per year than white applicants; and second, Hispanic/African American communities experienced both big run-ups during the housing boom and terrible drops during the downturn.

Not all is lost, though. Humphries did note that home prices are expected to pick up in those communities over 2015 and 2016, and that recent data shows that minority homebuyers have found success with FHA-backed loans.

See our graph below for some additional perspective:

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  • Pam says:

    Not sure what Zillow’s race baiting is all about, but perhaps there is less awareness of credit scores which play a huge part in qualifying for a mortgage. I knew my credit scores took a hit after the Dodd/Frank act was forced upon us and I kept watch & waited until I knew they were back up, ensuring my application to refinancing would be accepted. Noone asked me the color of my skin

  • leighton jackson says:

    iam aware of this just on sheer how difficult it is for black applicants. this needs to be fixed

  • Gabacho Whitebread says:

    As long as we have to check “race” on any government issued or government required document, we will have racism in America. Before anyone could make an opinion on this, we’d have to see the income of the applicant, size of the loan requested, and of course run a credit check ! Until then, we just consider this a race baiting attempt by Zillow !

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