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HMDA Data Finds Mixed Results on Minority Homeownership

Phil Hall
Sep 30, 2016
More blacks and Hispanics received home purchase loans in 2015, but they also experienced higher levels of loan denial, according to Home Mortgage Disclosure Act (HMDA) data released by the Federal Financial Institutions Examination Council (FFIEC)

More blacks and Hispanics received home purchase loans in 2015, but they also experienced higher levels of loan denial, according to Home Mortgage Disclosure Act (HMDA) data released by the Federal Financial Institutions Examination Council (FFIEC).

The share of home purchase loans for one-to-four family properties made to black borrowers rose from 4.9 percent in 2014 to nearly 5.2 percent last year, while the share made to Hispanic-white borrowers rose from 7.5 percent to 7.9 percent. Asian borrowers received fewer purchase loans, with this demographic share declining from 5.7 percent to 5.5 percent. The share of refinance loans made to black borrowers decreased from 5.2 percent to 4.9 percent, while the share made to Hispanic-white borrowers rose slightly from 6.0 percent to 6.1 percent, and those made to Asian borrowers rose from 4.5 percent to 5.1 percent.

However, black and Hispanic-white applicants experienced higher denial rates last year for conventional home purchase loans, while Asian applicants had comparable denial levels to white applicants. The FFIEC stressed that these “relationships are similar to those found in earlier years and do not take into account potential differences in risk characteristics across demographic groups.”

For the nation as a whole, the share of one- to four-family home purchase loans made to low- and moderate-income borrowers (those with income of less than 80 percent of area median income) saw a scant increase from approximately 26 percent in 2014 to roughly 27 percent in 2015, while the share of refinance loans to low- and moderate-income borrowers decreased from 24 percent to 22 percent. The total number of originated loans of all types and purposes increased by 1.4 million, or 22 percent, between 2014 and 2015, with refinance originations up by 36 percent and home purchase lending up by 13 percent.

On the decline was the number of lenders: the FFIEC determined there was a 2.5 percent decline in companies reporting the HMDA data. This drop was attributed to mergers and acquisitions within the mortgage lending environment.

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