Redlining Was Banned 50 Years Ago. It’s Still Hurting Minorities Today.

Articles | March 26 2019

By Tracy Jan

Racial discrimination in mortgage lending in the 1930s shaped the demographic and wealth patterns of American communities today, a new study shows, with 3 out of 4 neighborhoods “redlined” on government maps 80 years ago continuing to struggle economically.

The study by the National Community Reinvestment Coalition, released Wednesday, shows that the vast majority of neighborhoods marked “hazardous” in red ink on maps drawn by the federal Home Owners’ Loan Corp. from 1935 to 1939 are today much more likely than other areas to comprise lower-income, minority residents.

“It’s as if some of these places have been trapped in the past, locking neighborhoods into concentrated poverty,” said Jason Richardson, director of research at the NCRC, a consumer advocacy group.

Researchers compared the HOLC maps, the most comprehensive documentation of discriminatory lending practices, with modern-day census data to determine how much neighborhood demographics have changed in 80 years. The findings have implications for today’s political debates over housing, banking and financial regulation, as well as civil rights, as Congress seeks to weaken the government’s ability to enforce fair-lending requirements. Policies that influence access to capital and credit have long-lasting effects on residential patterns, neighborhoods’ economic health and household accumulation of wealth, the report said. (Read more)