Today's Date: August 8, 2022
Test Release special characters in the headline © ® ™ é ñ ü ç î ò   •   AARP Illinois Thanks Senate Majority Whip Dick Durbin and Senator Tammy Duckworth For Historic Vote Toward Real Relief on Prescr   •   Mogul Launches Nationwide Campaign Called “Build Better Boards” to Champion More Diverse Boards   •   LIBERTY Dental Plan of New York Awards 12 Scholarships in Partnership with PENCIL   •   Mogul Launches Nationwide Campaign Called “Build Better Boards” to Champion More Diverse Boards   •   LIBERTY Dental Plan of New York Awards 12 Scholarships in Partnership with PENCIL   •   Celebrating the one-year anniversary of the signing of the Canada-Quebec Asymmetrical Agreement on the Canada-Wide Early Learnin   •   Test Release special characters in the headline © ® ™ é ñ ü ç î ò   •   Greenwood and Travis Hunter Sign NIL Deal and Partner to Launch the “Choose Black” Campaign   •   GovX Raises Over $11,000 for FOLDS OF HONOR Veteran Nonprofit for Month of July   •   “What I Want to Know with Kevin P. Chavous” Podcast Launches Third Season in Search of Answers to Education’s   •   Greenberg Traurig Vice Chair Lori G. Cohen Named to Benchmark Litigation's 2022 Top 10 Women in Litigation List   •   AARP Pennsylvania Thanks Senator Casey For Historic Vote Toward Real Relief on Prescription Drug Pricing   •   BYRON ALLEN'S ALLEN MEDIA GROUP SIGNS VETERAN NEWS & POLITICAL TELEVISION HOST MARC LAMONT HILL TO THE GRIO   •   Greenwood and Travis Hunter Sign NIL Deal and Partner to Launch the “Choose Black” Campaign   •   Poll: Over Half of Voters of Color Oppose Government Negotiation of Drug Prices Once They Learn About Consequences for Patients   •   Who's Next? Black Women's Health Imperative Urges Voters to Affirm Abortion Rights in Wake of Kansas Abortion-Referendum   •   Los Angeles City Council Votes NO on SB 930 - the 4 a.m. Bar Bill, Sends Strong Message to Sacramento and Senator Wiener that Pu   •   Government of Canada honours national historic significance of Second World War code breakers   •   The Honourable Daniel Vandal, Minister of Northern Affairs, will be traveling to the North through August 8 to 19, 2022

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DOJ Lending Case Highlights Abuses

 WASHINGTON  -- The Department of Justice's $2 million settlement this week with PrimeLending spotlights serious problems on loans insured by the Federal Housing Administration (FHA). The case found inconsistent and abusive pricing on loans to African-American borrowers, revealing that it's far too easy for lenders making government-backed loans to overcharge home buyers. 

The FHA insures mortgages that meet specific risk criteria, but the rules on how much lenders can charge remain loose. The result is that equally qualified borrowers have been charged significantly different interest rates.  

"Too many lenders making FHA-backed mortgages are doing Wild West lending," said Evan Fuguet, Senior Policy Counsel for CRL.  "The FHA was created to make mortgages accessible, affordable and sustainable. Without clear rules to prevent overcharging, abuses are inevitable. That undercuts the reason the program was created in the first place."

Many of the bad lending practices that precipitated the subprime crisis have been addressed, but there's more to be done. The FHA should adopt the following policies:

  • Immediately apply pending Federal Reserve rules that, come April, will ban kickbacks and other incentives to overcharge for mortgages. 
  • Establish reasonable limits on loan costs to prevent inconsistent and abusive pricing.  
  • Maintain a strong focus on access to fair and affordable credit for all families regardless of race.
  • Continue to strengthen efforts to enforce FHA rules.  

About the Center for Responsible Lending

The Center for Responsible Lending is a nonprofit, nonpartisan research and policy organization dedicated to protecting homeownership and family wealth by working to eliminate abusive financial practices. CRL is affiliated with Self-Help, one of the nation's largest community development financial institutions.


STORY TAGS: BLACK, AFRICAN AMERICAN, MINORITY, CIVIL RIGHTS, DISCRIMINATION, RACISM, , RACIAL EQUALITY, BIAS, EQUALITY, culture



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