Advertisement

Drudge Retort: The Other Side of the News
Wednesday, September 01, 2021

Nationally, loan applicants of color were 40%-80% more likely to be denied than their White counterparts -- In certain metro areas, the disparity was greater than 250%

More

Comments

Admin's note: Participants in this discussion must follow the site's moderation policy. Profanity will be filtered. Abusive conduct is not allowed.

More from the article...

...The new four-bedroom house in Charlotte, N.C., was Crystal Marie and Eskias McDaniels's personal American dream, the reason they had moved to this Southern town from pricey Los Angeles a few years ago. A lush, long lawn, 2,700 square feet of living space, a neighborhood pool and playground for their son, Nazret. All for $375,000.

Prequalifying for the mortgage was a breeze. They said they had saved much more than they would need for the down payment, had very good credit"scores of 805 and 725 -- and earned roughly six figures each, she in marketing at a utility company and Eskias representing a pharmaceutical company. The monthly mortgage payment was less than they'd paid for rent in Los Angeles for years....



#1 | Posted by LampLighter at 2021-08-31 01:15 PM | Reply

Doing taxes for performing artists, most of them have multiple W-2s. (My most recent had 28 W-2s, three 1099s, and other side income not on 1099s.)

A few years ago, a new-to-town young actor came in, and had a half-dozen W-2s from the six most respected theatres in town. Wow, look at you! I said.

Then I added, "Of course, if you gave this to a banker he'd ask why TF you can't keep hold of a job."

#2 | Posted by Danforth at 2021-08-31 01:25 PM | Reply | Newsworthy 2

This is the kind of thing Trump was talking about when he told suburban moms that he saved their neighborhoods.

Trump isn't the only one making it hard for undesirables to move in.

To keep property values up, of course. I'm sure racism has nothing to do with property values going down when neighborhoods get darker...

#3 | Posted by snoofy at 2021-08-31 03:27 PM | Reply

This is one of those articles written to show racism where there is none.
Banks make money by making then selling mortgages into the secondary market.
A lot of people in the process get paid on commission only if the deal closes. Do you think they're going to lose a paycheck they worked for because some asshat doesn't want to make a loan based on someone's race?

#4 | Posted by ScottE at 2021-09-01 10:51 AM | Reply

@#4 ... This is one of those articles written to show racism where there is none. ...

... or that racial bias is so ingrained in the system that some try to explain it away by saying it is not there because capitalism seems to benefit from it.


#5 | Posted by LampLighter at 2021-09-01 11:19 AM | Reply | Newsworthy 1

Some people really really really want to deny the truth.

#6 | Posted by LegallyYourDead at 2021-09-01 12:38 PM | Reply | Newsworthy 3

@#6

I look at it as ~some people will argue against the existence of what they want to continue to exist.~

If they do not acknowledge it exists, what is the need to eliminate it?

#7 | Posted by LampLighter at 2021-09-01 01:31 PM | Reply | Newsworthy 1

I didn't say there wasn't racism so stop saying I did. You folks have a real bad habit of doing that.
I was speaking to the premise of this article which is some white person get approved and some black people get denied therefore it's racist. There's too many other factors that they omit or gloss over in an attempt to prove their theory.

#8 | Posted by ScottE at 2021-09-01 01:39 PM | Reply

Also from the article:

With the help of their real estate agent, and multiple emails from her employer on her behalf, she and her husband Eskias pushed back against the denial.

At around 8 p.m. on the night before the original closing date, Crystal Marie got an email from the lender: "You're cleared to close."

#9 | Posted by ScottE at 2021-09-01 01:42 PM | Reply

"I didn't say there wasn't racism so stop saying I did. You folks have a real bad habit of doing that."

I have noticed that is a very common debate tactic on this site.

#10 | Posted by jakester at 2021-09-01 01:46 PM | Reply

@#8 ... I didn't say there wasn't racism so stop saying I did. ...

I said no such thing about you.

... I was speaking to the premise of this article which is some white person get approved and some black people get denied therefore it's racist. There's too many other factors that they omit or gloss over in an attempt to prove their theory. ...

The article goes into comparisons that show it may exist.

 
... to prove their theory. ...

I do not think the article was out to "prove" anything, merely show the results of their data analysis. The place to prove anything is in a court.

From the article...

...Even accounting for factors lenders said would explain disparities, people of color are denied mortgages at significantly higher rates than White people ...

@#9 ... "You're cleared to close." ...

After how much extra expense?

After how much extra effort?

Why wasn't it approved right at the beginning?


#11 | Posted by LampLighter at 2021-09-01 01:50 PM | Reply

"#8 | POSTED BY SCOTTE"

Just what do you mean by "you folks"?

#12 | Posted by LegallyYourDead at 2021-09-01 02:07 PM | Reply

#10 | POSTED BY JAKESTER AT 2021-09-01 01:46 PM | FLAG: "LIBERAL" - SUUUUURRRRREEEE, buddy.

#13 | Posted by LegallyYourDead at 2021-09-01 02:08 PM | Reply

"I didn't say there wasn't racism so stop saying I did. You folks have a real bad habit of doing that."

And "you folks" continue to deny the existence of something that clearly does exist.

You claimed it didn't exist in this article even tho it was proved to exist.

Therefore you are denying that it exists when it clearly does exist and it was proved statistically that systemic racism is built right into the algorithm used to grant loans.

Does it exist or not? Maybe you need to be more clear with what you are trying to say? Don't blame us for your lack of clarity. Seems pretty clear to me.

"Even accounting for factors lenders said would explain disparities, people of color are denied mortgages at significantly higher rates than White people"

#14 | Posted by donnerboy at 2021-09-01 02:24 PM | Reply | Newsworthy 1

12 | POSTED BY LEGALLYYOURDEAD AT 2021-09-01 02:07 PM | REPLY

You folks means most of the left leaning members of this site who have an annoying habit of attacking you for something they say you said when you didn't say it at all. It's the same $#it Ben Shapiro does and I don't like it.

#15 | Posted by ScottE at 2021-09-01 02:32 PM | Reply

#8 | Posted by ScottE

You said "This is one of those articles written to show racism where there is none."

In regard to this article, what did it contain that led you to the belief there is none - note those words imply there is not racism in lending.

I am a data guy and I did read the article and carefully considered what they were saying. I have had knock down drag outs in my position about data and what it is saying. I admit I had a personal bias that I was skeptical before digging into the article. Without seeing the actual data, it sounds like they and several significant institutions have gone through the exercise of doing the same leg work. The problem is that Fannie and Freddie can't get out of the way with there ancient algorithm and won't approve others. Besides that, given where algorithm development was in the early 90s there is no way bias is not built in. Massive teams at corporations today are finally figuring out how to eliminate the bias in their cutting edge algorithms...

The complaint Fannie and Freddie have about the burden of evaluating algorithms seems like part of their duty. To me, it's pretty easy to do the comparisons on algorithms. You have a data set and you run it through the algorithms one by one. Then you look at the results. Yes evaluating the results is a bit of a burden but it should be easy to see trends, bubbles and anomalies.

Finally, you note that in the article they did receive the loan. At best that's an anecdotal "feel good" because they had to fight for the approval - it is very clear not all in their shoes see the same result.

#16 | Posted by GalaxiePete at 2021-09-01 02:47 PM | Reply | Newsworthy 2

The way to test if something is racist is does it have a disparate racial impact.

The proof is in the pudding.

This obviously has a disparate racial impact.

#17 | Posted by snoofy at 2021-09-01 02:55 PM | Reply

"This is one of those articles written to show racism where there is none."

What would it take, to show racism?

You tell us.

#18 | Posted by snoofy at 2021-09-01 02:57 PM | Reply

"There's too many other factors that they omit or gloss over in an attempt to prove their theory."

Riiiight!!!! What a bunch of garbage you post....pretty much all the time.

"This is the kind of thing Trump was talking about when he told suburban moms that he saved their neighborhoods."

Exactly!

#19 | Posted by danni at 2021-09-02 10:16 AM | Reply

Even accounting for factors lenders said would explain disparities, people of color are denied mortgages at significantly higher rates than White people"
#14 | POSTED BY DONNERBOY AT 2021-09-01 02:24 PM | REPLY |

What factors and how were they accounted for?? If the authors can't answer that question then they should have prefaced the above statement with, 'In our opinion'.
There's a lot of unanswered questions in the article and I suspect it's on purpose.
Was the couple married or just in a relationship?
Did they apply for the mortgage together or was it just Crystal?
Was this their first mortgage or had they previously owned a home?
How long have they had their six figure jobs? (The last time I applied for a mortgage they wanted the last 2 years tax return)
What is there debt to income ratio? (This is the number one reason people get denied.)

I've got many mortgages over my life and more often then not they don't go smooth. I've been initially denied and had to provide additional information or money to satisfy the underwriter and finally get approved.

My son just bought a house and was initially denied because of that debt to income ratio. They wanted him to pay his car loan off which he did. So while it really didn't change his financial situation it did change the ratio and he closed on the home.

#20 | Posted by ScottE at 2021-09-02 11:17 AM | Reply

Riiiight!!!! What a bunch of garbage you post....pretty much all the time.
"This is the kind of thing Trump was talking about when he told suburban moms that he saved their neighborhoods."
Exactly!

#19 | POSTED BY DANNI AT 2021-09-02 10:16 AM

Everything is garbage to to you when you're not in agreement.

And Trump failed again because they got the house.

#21 | Posted by ScottE at 2021-09-02 11:19 AM | Reply

Finally, you note that in the article they did receive the loan. At best that's an anecdotal "feel good" because they had to fight for the approval - it is very clear not all in their shoes see the same result.

#16 | POSTED BY GALAXIEPETE AT 2021-09-01 02:47

Pete you're a data guy so tell me what I'm missing because I don't see enough data on the one example they provided in the article to show a racial bias.

I do find it telling that in the one and only example provided the individual actually got approved the day before the original closing date.

#22 | Posted by ScottE at 2021-09-02 11:25 AM | Reply

What would a racial bias look like?

How much lower would the black graph need to be, to show bias? Or would that graph never show bias?
???

#23 | Posted by snoofy at 2021-09-02 11:34 AM | Reply

"What factors and how were they accounted for??"

You really don't care. It's all in the article you said you read.

It is telling you that the algorithm is flawed. They did an actual study. You have done nothing but deny the truth even those you don't really know anything. Like a good little Republican.

"Holding 17 different factors steady in a complex statistical analysis of more than two million conventional mortgage applications for home purchases, we found that lenders were 40 percent more likely to turn down Latino applicants for loans, 50 percent more likely to deny Asian/Pacific Islander applicants, and 70 percent more likely to deny Native American applicants than similar White applicants. Lenders were 80 percent more likely to reject Black applicants than similar White applicants. These are national rates."

The only data they did not have access to was data they could not legally access.

In EVERY case, the prospective borrowers of color looked almost exactly the same on paper as the White applicants, except for their race. (Emphasis mine)

#24 | Posted by donnerboy at 2021-09-02 02:06 PM | Reply

What would a racial bias look like?
How much lower would the black graph need to be, to show bias? Or would that graph never show bias?
???

#23 | POSTED BY SNOOFY AT 2021-09-02 11:34 AM | REPLY

The graph shows denial rate by credit score but even the article states the number one reason people are denied is debt to income ratio. If you look at all the races using that the denial rates are all within 3 percentage points.

#25 | Posted by ScottE at 2021-09-02 02:16 PM | Reply

'What factors and how were they accounted for??"
You really don't care. It's all in the article you said you read.

Holding 17 different factors steady in a complex statistical analysis...'

I read the article and no they don't give the 17 factors.. Did you read it? Or just cut and paste a statement that you think makes you look smart.

I guess it too complex for us commoners to understand so we gotta take their word. Well I'm still calling -------.
Tell me the 17 factors smart guy and the methodology used to compare them?

#26 | Posted by ScottE at 2021-09-02 02:25 PM | Reply

"Tell me the 17 factors smart guy and the methodology used to compare them?"

Okay.

We built one main regression model for all conventional mortgages in our universe and applied it to the entire country. We then created two derivative models from that main one: one to analyze major metropolitan areas and another to analyze individual lenders.

Our national model for conventional applications contained 17 variables:

Race
Sex
Whether the application had a co-applicant
Age
Income
Loan amount
Property value
Mortgage term
Credit model used
Debt-to-income ratio
Combined loan-to-value ratio
The automated underwriting system used
The ratio between the median income of the census tract where the property is located and the median income of the metro area
The type of lender (added variable to HMDA data)
The size of the lender (added variable to HMDA data)
Non-Hispanic White population percentage of the census tract where the property is located (added variable to HMDA data)
Size of the metro area where the property is located (added variable to HMDA data)
themarkup.org

#27 | Posted by snoofy at 2021-09-02 02:42 PM | Reply

"Well I'm still calling -------."

Yeah, I believe you.
That's why I asked what would show racism.
And since you can't say, that means you'll never be able to accept it.

Because you call -------- on things you don't like.

#28 | Posted by snoofy at 2021-09-02 02:44 PM | Reply

Comments are closed for this entry.

Home | Breaking News | Comments | User Blogs | Stats | Back Page | RSS Feed | RSS Spec | DMCA Compliance | Privacy | Copyright 2021 World Readable

Drudge Retort