Giving Credit Where it’s Due: Latinos and Credit Scores

By Agatha So, Policy Analyst, Economic Policy Project, NCLR
Family in front of house

In the run up to the Great Recession, Latinos and other low-income homebuyers of color more often than not received higher-priced mortgage loans than White borrowers. Today, Latinos and low-income communities of color are still being short-changed in the mortgage market.

In 2015, few mortgages were made to Latino and Black borrowers, with 8% of all home purchase loans made to Latinos, and only 5% going to Black borrowers. Tight lending standards have made it difficult for millions of Americans to buy a home since the Great Recession, especially for Latinos and low-income families with credit scores below 700. While the minimum credit score needed to qualify for a home loan has increased by 40 points, the credit scores of Latinos who receive mortgages have increased by nearly 80 points since 2000.  Moreover, Latino borrowers are less likely than White borrowers to have a credit score and full credit history, making them appear riskier to lenders than they really are.

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Is Homeownership Just a Dream for Latino Millennials?

By Agatha So, Policy Analyst, Economic Policy Project, NCLR

Family in front of home

While American families who bought a home before the Great Recession were likely most concerned with the interest rates of their home loan, today’s millennials might be more preoccupied with the interest rates and repayment plans on their student loans.

Nearly 70 percent of bachelor’s degree recipients leave school with debt. Student loan debt is one of the largest burdens carried by Americans today, second only to mortgage debt. As a result, it comes as no surprise that student loan debt may be holding back millennials, especially older millennials, from buying a home.

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Treasury’s Financial Regulation Report: A Wall Street Wish List

By Renato Rocha, Policy Analyst, Economic Policy Project, NCLR

This week the U.S. Department of the Treasury released a report to the president that outlines recommendations to rollback critical safeguards, including consumer protections that were put in place in the wake of the Great Recession. The Treasury report comes less than a week after the U.S. House of Representatives passed the Financial CHOICE Act, legislation that would deregulate financial institutions and expose our entire economy to a heightened risk of instability.

The Treasury’s proposals are straight from a Wall Street wish list, as the proposals effectively  gut the Consumer Financial Protection Bureau (CFPB).

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Six Trends That Show Latino Homeownership is Important to the Housing Market and the Economy

By Agatha So, Policy Analyst, Economic Policy Project, NCLR

Headlines about the nation’s housing market have focused on the low homeownership rate, currently stalled at 63%, compared to a high in 2001 of more than 73%. Yet, little attention has been paid to the impact of the low Hispanic homeownership rate on America’s ongoing economic recovery, and in turn, the future of the nation’s housing market.

Overlooking this impact is a huge oversight, given that the majority of new households formed in the next two decades will be made up by homeowners of color. In fact, Latinos are expected to account for 40% of those new households. At the end of 2016, the Hispanic homeownership rate increased to 47%, but remained much lower than the peak of 50% nearly 10 years ago. With significant household growth on the horizon, creditworthy Latinos need access to homeownership to ensure that the opportunity to build wealth is available to all Americans in the decades to come.

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Latinos Overwhelmingly Support Consumer Protection

By Renato Rocha, Policy Analyst, Economic Policy Project, NCLR

In less than six years since opening its doors, the Consumer Financial Protection Bureau (CFPB) has brought transparency to the remittance industry, stopped credit card companies from adding on products that consumers never agreed to, and required mortgage lenders to ask applicants for proof of their income before making home loans. Its creation is one of the most important accomplishments of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.

Despite the CFPB’s hard work on behalf of American families, efforts are underway to dismantle the agency. One such attempt is the “Financial Choice Act of 2017,” House Financial Services Committee Chairman Jeb Hensarling’s vehicle to de-regulate the financial industry and dismantle the CFPB.

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