California Black, Latino, Native American borrowers get fewer home mortgages than whites regardless of income, new research shows

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OAKLAND, CALIFORNIA November 24, 2020 – Black, Latino and Native American borrowers continue to receive far fewer home purchase loans in California than Whites, according to a new analysis of federal home loan data released today by The Greenlining Institute. 

“In our society, homeownership remains critical to building wealth and financial stability,” said report author Rawan Elhalaby, Greenlining’s Senior Economic Equity Program Manager.  “The racial discrepancies we see can’t be explained simply by differences in income. It will take a concerted effort by banks, non-bank lenders and financial regulators to overcome the systemic disadvantages that Black, Latino and Indigenous borrowers still face.”

Home Lending to Communities of Color in Californiais based on data for 2019 reported under the federal Home Mortgage Disclosure Act. Among the report’s key findings:

• Black and Latino Californians’ shares of home purchase loans were only about 60% of what would be expected based on their percentage of the state’s population, while Whites were overrepresented. Native Americans’ share of home mortgages was about half of what would be expected based on their population.
• Even among low-income communities, Black and Latino borrowers lagged behind Whites in their share of home purchase loans, indicating that the racial and ethnic discrepancies can’t be explained solely by income differences.
• Women of color make up 30% of California’s population but received only about 8% of home loans.
• Non-bank lenders, which operate similarly to traditional lenders but are not regulated by the Community Reinvestment Act, are gaining market share without making community commitments common among traditional banks.
• In the Los Angeles/Long Beach/Glendale Metropolitan Statistical Area, Latinos make up nearly half of the population but received less than 23% of home purchase loans. The Black community represents 7.76% of the population and received 4.04% of home purchase loans.
• In the San Francisco/San Mateo/Redwood City region, the Black community makes up. 3.6% of the population but received just 0.73% of home purchase loans. Latinos, nearly 20% of the population, got only 4.18% of home purchase loans.

 To learn more about The Greenlining Institute, visit www.greenlining.org.