Today, JPMorgan Chase announced that five organizations will receive philanthropic capital as part of the firm’s $400 million, five-year commitment to improving housing affordability and stability for underserved households, particularly in Black, Hispanic, and Latino communities.
This is part of JPMorgan’s commitment to supporting organizations that scale innovative housing models, such as single-family housing production, to increase the supply of affordable housing and homeownership, the company said. It’s a firmwide effort to address the housing affordability gap by using the firm’s business, data, policy and philanthropic resources, it said.
“Owning a home is a key factor to providing family stability and building generational wealth, but out of reach for far too many people, especially Black, Latino, and Hispanic households,” said Abigail Suarez, head of neighborhood development at JPMorgan Chase. “Today’s announcement will help address current barriers to homeownership and allow more families access to wealth building opportunities.”
Additionally, JPMorgan’s PolicyCenter is advancing data-driven policy solutions to improve homeownership opportunities weakened by the pandemic, the firm said.
Diversity initiatives, especially from big banks like JPMorgan, help provide capital to underserved communities, which can offset discriminatory behavior that’s commonly found in the banking world.
JPMorgan has also been accused of these kinds of unethical banking practices. Recently, a Black female patron of JPMorgan Chase filed a lawsuit against the bank and two employees at the bank’s branch for discriminatory and unethical behavior. In December 2021, Dr. Malika Mitchell-Stewart walked into a JPMorgan Chase Bank in Sugar Land, Texas, to deposit a signing bonus check and open an account. When Mitchell-Stewart was being assisted by a bank worker, Trupti Patel, however, she was subjected to a peculiar line of questioning. According to the lawsuit, Patel challenged the validity of the signing bonus check and Mitchell-Stewart’s employment as a physician.
That’s just one example in JPMorgan’s long history of settling discrimination lawsuits, which includes a $24 million settlement for an employees' racial discrimination lawsuit filed in 2018, and a $9.8 million settlement for a gender discrimination lawsuit filed in 2020.
In 2017, JPMorgan was served a federal civil rights lawsuit, alleging the bank engaged in discriminatory wholesale mortgage practices from 2006-09. According to the lawsuit, the bank was responsible for brokers charging Black and Hispanic borrowers higher rates for mortgages than white borrowers with similar credit profiles. Manhattan U.S. Attorney Preet Bharara found that JPMorgan had the legal responsibility and the available data to know whether pricing was being used in violation of the law. Bharara estimates that the disparities in loan terms resulted in around 53,000 Black and Hispanic borrowers being charged “tens of millions” of dollars more for home loans than white borrowers. Eventually, the bank agreed to pay $55 million to settle claims just hours after the lawsuit was filed.
JPMorgan is now engaged in a number of diversity initiatives, committing a total of $12 million to increase homeownership opportunities for Black, Hispanic, and Latino households. The Atlanta Neighborhood Development Partnership (ANDP) received $2.5 million as part of JPMorgan Chase’s three-year commitment to advance affordable housing and racial equity. Additionally, the Center for Community Self-Help will receive $2 million; Grounded Solutions Network will receive $2 million; The Housing Partnership Network will receive $3 million; and Parity Homes will receive $2 million, all within a three-year commitment.
“Innovation and scale are desperately needed to address the growing race-based homeownership gap and resulting wealth disparity,” said John O’Callaghan, president & CEO of Atlanta Neighborhood Development Partnership. “This support from JPMorgan Chase will enable us to grow our model, deploy more capital through small, undercapitalized Black-owned real estate companies, and develop homes that provide affordable housing and generate critical wealth for families.”
JPMorgan also will work with the Urban Institute to test and scale these innovations to advance housing stability and affordability for Black, Hispanic and Latino households, it said.
“I am proud of Urban’s work with JPMorgan Chase to identify, assess, and expand these solutions,” said Urban Institute President Sarah Rosen Wartell. “I look forward to supporting the grantees as they advance innovations to address the nation’s housing affordability crisis and overcome homeownership barriers that have stifled opportunity for households of color.”
These commitments are part of a much larger effort to donate $30 billion for advancing racial equity and drive an inclusive economic recovery that was announced in October 2020.
