From Foreclosure to Redlining: How America’s Largest Financial Institutions Devastated California Communities
Submitted by admin on February 8, 2010 – 1:20 pm
The California Reinvestment Coalition released this report (PDF) about subprime lending to communities of color in California. Here are their key findings:
Lenders saturated California neighborhoods with high-cost and predatory loans:
- In 2006, in each city, lenders were more likely to make high-cost loans in neighborhoods of color. In Sacramento and Stockton, for example, nearly 50% of all loans made in neighborhoods of color were subprime.
- Similarly, high-cost loans were concentrated in neighborhoods of color, while lowercost prime loans were more likely to be located in non-minority neighborhoods. So, for example, in San Diego, neighborhoods that are predominantly neighborhoods of color (where 80% or more of the residents are people of color) received 20% of all of the high-cost loans made in the city, while those same neighborhoods received a mere 11% of lower-cost prime loans originated in San Diego.
- At the city level, high-cost loans by Big Bank Lenders (Bank of America, Citibank, Indymac/OneWest, JP Morgan Chase, US Bank, and Wells Fargo, and their affiliates) were concentrated in neighborhoods of color, as well. In Oakland, the Big Bank Lenders made 70% of all of their high-cost loans in neighborhoods predominantly of color. At the same time, the Big Bank Lenders made just over 40% of their lower-cost prime loans in these same neighborhoods.