Mortgages Still Difficult For Blacks To Get – NMP
Industry News

Mortgages Still Difficult For Blacks To Get

Jun 29, 2020
Black mother and son at a sink | Photo by CDC on Unsplash
A headshot of Keith Griffin
Senior Editor

New research published by the Consumer Financial Protection Bureau (CFPB) shows Blacks are more likely to be denied mortgages compared with white borrowers. On the plus side, the numbers do show an increase in the percentage of new home loans going to Black buyers.
 
The data is part of the Bureau’s third annual series of Bureau Data Point articles describing mortgage market activity over time based on data reported under the Home Mortgage Disclosure Act (HMDA).
 
The major reason for mortgage denial among the Black community is a reliance on debt-to-income ratios. Urban Institute research shows, that the ratios “are much less significant predictors of loan performance than FICO scores and that many high-DTI loans have strong FICO scores.”
 
Henry Louis Taylor Jr., a professor of urban and regional planning at the University of Buffalo, told Marketplace that the ratios are difficult on Blacks because of smaller paychecks. “They’re not going to do well on that because of the low incomes that they have traditionally and because of the debts that they acquire just trying to make ends meet,” he said.
 
Among the data reported, about 7% of new home loans went to Black homebuyers in 2019, up from 6.7% in 2018. Nikitra Bailey with the Center for Responsible Lending told Marketplace while that’s an improvement, “African Americans continue to be underserved in the mortgage finance system in relation to their population overall.”
 
The Consumer Financial Protection Bureau has proposed a new rule that would diminish the impact of debt-to-income ratios. The new rule would remove the general qualified mortgage loan definition’s 43 percent debt-to-income limit and replace it with a price-based threshold.
 
Click here to read more from Marketplace.
 
 
About the author
A headshot of Keith Griffin
Senior Editor
Keith Griffin is a senior editor at NMP.
Link copied
Published
Jun 29, 2020
Get the NMP Daily
Tech
Polly Pushes PPE Setup Into The Pre-Contract Stage

The mortgage technology provider says AI-assisted configuration can get prospective customers much of the way through setup before they sign

Switching a mortgage lender's pricing engine isn't exactly a plug-and-play exercise.Polly says it has found a way to move much of that work earlier in the process — before a lender has even signed a contract.The mortgage technology provider announced Tuesday that it has reva...

Continue reading
Military Lending
Repeat Buyers Make Up Nearly 60% Of VA Purchase Business

VA's latest reminder about reusable benefits highlights an opportunity for originators to revisit past clients — and understand the rules around remaining entitlement

Veterans who have already used their VA home loan benefit aren't a niche segment of the VA purchase market. They're the majority.Nearly 60% of VA purchase loans in the latest full fiscal-year data went to previous homebuyers, a figure that takes on new relevance after the De...

Continue reading
Renew your NMLS License — for free.

Enjoy access to a free NMLS renewal class when you attend an in-person event.

Find an event
More from
Industry News
CHLA: More Freddie Mac MBS Buying Could Narrow Mortgage Spreads

Trade group estimates greater Freddie participation could compress spreads another 10 to 12 basis points as Fannie has taken the lead in GSE mortgage-bond buying

Industry News
Sep 23, 2026
Early Loan-Limit Race Splits Into Three Tiers

Lenders are now offering $845,000, $847,440, or $850,000 before FHFA sets the official 2027 limits

Industry News
Sep 23, 2026
Better, Garg Clash Over Claimed 46% Shareholder Support

Better disputes its former CEO’s preliminary consent count as the two sides trade accusations and an Oct. 2 target date approaches

C-Suite Strategies
Sep 23, 2026
Fannie Changes How Rent From A Former Home Counts

Fannie now prohibits leases for departing residences and permits market-analysis tools instead of Form 1007, creating a key documentation difference from Freddie Mac

Regulation and Compliance
Sep 22, 2026
MPF Expands Eligibility For Manufactured And Renovation Loans

The Mortgage Partnership Finance Program has expanded MPF Traditional eligibility for affordable loans, manufactured homes, renovations, and lender-funded assistance

Industry News
Sep 22, 2026
Fed Hike Raises HELOC Costs While Mortgage Rates Stay Near 7%

Prime rose to 7% while the 10-year Treasury remained near 5%, giving originators two different borrower conversations

Industry News
Sep 17, 2026