Were you cursed with skin a shade darker than a gleaming opalescent white? Are your nethers nutmeg or, worse yet, ebony? Well, the honkies here at the Consumerist love you… but unfortunately, loan companies don’t. Also, you can’t have any of our money.
The Center of Responsible Lending recently did a study of 50,000 subprime loans. What they found was that Latinos and African-Americans were often given disproportionately high interest rates when compared to their cracker peers. In fact, they are a third more likely to get a high-priced loan than Anglo-Saxon borrowers with the same credit profile.
Good quote summarizing why this is a big problem, besides just being racist: “[The study findings show] that it’s even harder for families of color to build equity for their future; it’s even harder to send their children to college; and it’s even harder to build wealth for the next generation.” Self-perpetuating generational poverty is a much bigger problem than mere prejudice; unfortunately, they all too often go hand in hand.
Study Disputes Lenders’ Excuses for Charging Blacks and Latinos Higher Rates [Consumer Affairs]