Experience with REDlining

[Travelle Mason]

It isn't anything new and it has been well documented (whether you are aware of it or not). I'm curious to know if there are any personal experiences with redlining for those seeking conventional mortgages, especially when seeking investment properties. 

There was only one discussion post that even mentioned it. If it's real estate, it's relevant. 

https://www.pbs.org/newshour/show/struggle-for-bla...

[Christi Hawkins]

This story is unbelievable, having been a Mortgage Loan Originator at both a small community bank and a large national lender I can say with great confidence that lenders take these Fair Housing laws quite seriously and the only color anyone sees is GREEN! You can NOT base a study and make assumptions like this without knowing the credit score and DTI. In this women's case a brand new collection will kill your score. The fix is you pay it off and wait. Mortgages are credit score driven now and Fannie Mae & Freddie Mac aren't making many exceptions, which is why she was able to get a loan with her partner who had the good score NOT because she was white. I like Senator Scott and I would agree with him about having the utility companies report to the credit bureaus but be careful what you wish for. I would disagree that the whole world needs to have access to everyone's credit score. In some cases FHA or USDA will accept non traditional trade lines but those better be perfect. Working in a small rural community that is 99% white, you run into the same issue. They don't borrow money in the traditional way, they don't have credit cards, they either pay cash or they don't buy it and unfortunately they do utilize all the Rent-to-Own places in town . In most cases you have to work with them awhile to get them to a point where they can borrow money for a house. It has absolutely nothing to do with the color of someone's skin, it has everything to do with following the guidelines. The HMDA reports set up by the genius's in DC don't give a clear picture as to why the loan was denied. The letter that goes out to the borrower and is usually kept at the lending institution will tell you why. This story was started with a conclusion and he did his best to find very weak data to support his beliefs. People don't Redline anymore, there's no money in it and the penalty for doing is too high and you will also lose your job if you get caught. Realtor's aren't even allowed to tell buyers what a good or bad neighborhood is, that's considered Redlining as well. If someone was from out of town and didn't know the area the best advice I could them was to find a neighborhood they liked and spend a couple hours sitting in their car and listen (it really only works in nice weather) but you can learn a lot about an area by listening to it. This kind of story is exactly what we don't need right now because it pits people against each other and it certainly doesn't help anyone. Are there prejudices out there, of course, but it's not only the color of someone's skin. My small community bank thought we were still living in the 1950's and they only wanted to do business with "important members of the community". They weren't even doing FHA or USDA loans until I got there and the arrogance of these people was shocking. My boss had been there 45 years and one day I had a couple come to see me about an FHA loan for the duplex they had been renting for 6 years. His comment to me after they left was he wondered if they were looking for the food stamp office instead. People are judged all the time by everyone and it's terrible that any of us would think we're better or somehow more sophisticated. But in this story they have it all wrong and we certainly don't need anymore hate. Sorry for the rant but this kind of thing really hacks me off