AMY GOODMAN: Here on Democracy Now!, I’m Amy Goodman with Nermeen Shaikh.
NERMEEN SHAIKH: A shocking new investigation
by Reveal and The Center for Investigative
Reporting has uncovered evidence that African
Americans and Latinos are continuing to be
routinely denied conventional mortgage loans
at rates far higher than their white counterparts
across the country.
Reveal based its report on a review of 31
million mortgage records filed with the federal
government in 2015 and 2016.
This is Reveal data reporter Emmanuel Martinez
speaking on PBS NewsHour about the investigation.
EMMANUEL MARTINEZ: Here we have the likelihood
of denial.
So, black applicants in Philadelphia are almost
three times as likely to be denied a conventional
mortgage.
REPORTER: Reveal found this troubling pattern
in dozens of cities.
Philadelphia was one of the largest.
EMMANUEL MARTINEZ: In 61 metros across the
country, applicants of color are more likely
to be denied a conventional mortgage, even
if they have the same financial characteristics
as a non-Hispanic white applicant.
AMY GOODMAN: The Reveal investigation found
the redlining occurring across the country,
including in Washington, D.C., Atlanta, Detroit,
Philadelphia, St. Louis, San Antonio, Texas.
The report is being published as the nation
is preparing to mark the 50th anniversary
of President Lyndon B. Johnson signing the
Fair Housing Act in April of 1968.
PRESIDENT LYNDON JOHNSON: The voice of justice
speaks again.
It proclaims that fair housing for all, all
human beings who live in this country, is
now a part of the American way of life.
AMY GOODMAN: We’re joined now by two guests:
Aaron Glantz, senior reporter at Reveal from
The Center for Investigative Reporting, his
new investigation headlined “Kept Out: How
banks block people of color from homeownership”;
and we’re joined by Rachelle Faroul, a 33-year-old
African-American woman who was rejected twice
by lenders when she tried to buy a brick row
house in Philadelphia, where Reveal found
African Americans were 2.7 times as likely
as whites to be denied a conventional mortgage.
She was only able to buy a home when her half-white
partner, Hanako Franz, signed on.
At the time, Hanako was nearly unemployed
and working part-time at a grocery store.
Aaron and Rachelle, we welcome you both to
Democracy Now!
Aaron, let’s begin with you in San Francisco.
First of all, explain what redlining is and,
then, how African Americans and Latinos are
kept out, why this is such a critical story
today.
AARON GLANTZ: Well, Amy, 80 years ago, the
federal government drew lines on map—
AMY GOODMAN: Well, we seem to have lost Aaron
for a moment, in a little satellite glitch.
So, why don’t we go right off to Ta-Nehisi
Coates He talked about the legacy of redlining
during an appearance on Democracy Now! a few
years ago, the significance of what this means
for the black and the Latino unity.
TA-NEHISI COATES: There’s no way to understand
housing as it exists today without federal
policy.
Black people, as was the thinking at the time,
could not be responsible home loaners.
The FHA literally drew up the redlining map
and then basically distributed—I’m sorry,
the Home Owners’ Loan Corporation actually
did it, and then distributed to banks who
used that as policy to determine how they
would lend and who they would lend to.
The racism in the system was pervasive and
total.
And the fact that African Americans have been
cut out of it is not shocking if you understand
what the country was in the 1930s and the
1940s.
And this redounds throughout generations.
As we know, homes are how people in America
build wealth, largely.
And if you cut black people out of that opportunity,
a lot is explained about what the African-American
community looks like today.
AMY GOODMAN: So, that was Ta-Nehisi Coates.
Rachelle Faroul, tell us your story.
You managed a million-dollar grant in your
job at the University of Pennsylvania, are
a contractor with Rutgers University.
Two lenders turned you down when you tried
to buy a home?
RACHELLE FAROUL: Yes.
And thank you so much for having me.
I started my homeownership journey in 2016,
soon after I moved to Philadelphia from Brooklyn,
where I was born and raised.
And I wanted to own property, like my mom,
like many of her siblings and their parents.
And from the beginning, it was just so difficult
for me to make this happen.
And it’s not to say that I am at all surprised.
As an organizer, as someone who is very well
read and well versed in all of the ways that
black people in America have been disenfranchised
routinely over the years, I was more hurt
than surprised.
And it really wasn’t until my partner, Hanako—who
identifies as Asian, not half-white—stepped
in and offered to be my co-borrower that it
was pretty much smooth sailing, to the extent
that our application was approved.
But as soon as she came on, I was largely
ignored, and really all that mattered was
my money.
That is, unfortunately, not the experience
of a large number of black people who try
to buy homes in America.
Most of us are routinely denied, our applications
are rejected, and we are forced to continue
to rent from people who don’t care about
us, don’t care about our well-being and
don’t really consider or value the ways
in which we help them accrue wealth.
NERMEEN SHAIKH: And, Rachelle, could you talk
about how it is—I mean, you tried, on two
different occasions, to get a loan.
How did the loan officers treat you, and how
did they treat your partner?
RACHELLE FAROUL: Sure.
So, in 2016, when I started this process by
myself, I had all of the paperwork.
I had my tax returns, which I do every year.
At that time, I was freelancing and was told
that I needed to have more steady income,
because so much of my income at the time was
undocumented, and to the extent that I was
being paid in cash or I wasn’t being paid
regularly, and they told me that I needed
to have a full-time job.
I then asked if it was possible for me to
have a co-signer, and they said yes.
I asked my mom.
She said yes right away, because this has
been just as much a dream for her as it has
been for me.
And we were rejected right away.
And Angela Colloi from FHA told us that the
reason why my mom couldn’t be a co-signer
was because she had too much student loan
debt from her Ph.D., from my bachelor’s
and also from my brother’s.
My mom has been incredible in helping me stay
afloat, my brother and I stay afloat, over
the years.
And it was really hurtful.
At that time, I was mostly hurt for her, because
she wanted to be able to support her child
in this, you know, really impactful and powerful
way and was told that she couldn’t.
And so, I left it at that and got a full-time
job here at Penn, where I still work, managing
a large grant.
And about a year later, I started the process
again with the Penn Home Ownership Services,
a forgivable loan that’s offered to Penn
employees.
And again I experienced a lot of difficulty,
this time with Santander Bank.
It was, overall, a—I would say, a humiliating
process, but one that was also really beautiful,
in a way, because all of the people who showed
up for me, including Aaron, Ray, the entire
team at The Center for Investigative Reporting,
Hanako, who is an incredible human, my friends,
my colleagues.
Folks really, you know, understood the meaning
of what is happening, and did as much as they
could to support me in my journey.
And so, while this has been—and still is,
you know, months after we closed—this has
been, you know, a reckoning.
Again, I am really happy with the way some
people showed up for me.
AMY GOODMAN: So you only got it when Hanako
signed on with you?
RACHELLE FAROUL: I’m sorry?
AMY GOODMAN: You only got it when Hanako signed
on with you?
RACHELLE FAROUL: Yes.
And it’s kind of ridiculous.
I mean, it’s something that we still laugh
about.
So, Hanako’s co-borrower application was
approved at a time when her credit score was
in the 700s.
And that is what mattered most, for whatever
reason.
What didn’t matter at all was the fact that
Hanako was working part-time at a grocery
store.
Her most recent pay stub was like $115.
I was helping her pay her health insurance,
because, you know, she had such little cash.
AMY GOODMAN: Well, listen, before we get to
the end of the show, we wanted—
RACHELLE FAROUL: But even so, she was considered
more qualified than me.
AMY GOODMAN: We wanted to bring Aaron Glantz
in, although I think we just have you on the
telephone, not in a studio, Aaron, because
of the satellite glitch.
But explain what redlining is and why this
is such an important exposé, “Kept Out:
How banks block people of color from homeownership.”
AARON GLANTZ: Well, I mean, as you said earlier,
President Lyndon Johnson signed the Fair Housing
Act in 1968, and that was supposed to make
mortgage discrimination illegal.
And it was supposed to allow people to build
wealth, no matter what their race was.
And it was supposed to end segregation.
And what we found in our investigation, 50
years later, is that in dozens of cities across
the country people of color are still being
turned away from the opportunity to live the
American dream.
And further, we found that the government
is completely dropping the ball on its enforcement
of these laws.
We found that the Obama administration had
sued only a handful of banks for violating
the Fair Housing Act.
In his first year in office, the Trump administration’s
Justice Department did not sue a single financial
institution.
And the Office of Comptroller of the Currency,
which is in charge of enforcing another law
called the Community Reinvestment Act, which
is supposed to get banks to lend in low-income
communities and underserved neighborhoods,
was passing these institutions on their community
lending reviews, 99 point—99 percent of
the time.
So, basically, the government is saying that
everyone in the banking and mortgage industry
is doing a fantastic job.
And yet we found that across the country people
of color are being turned away, even when
they make the same amount of money as whites,
even when they’re trying to take on the
same size loan as whites, and even when they’re
trying to buy in the same neighborhoods as
whites.
AMY GOODMAN: And you found that Philadelphia,
where Rachelle Faroul is, was particularly
egregious.
AARON GLANTZ: We found that in Philadelphia
African Americans were 2.7 times more likely
to be turned away for a loan, even when you
take into account factors that loan officers
should be using, like income, that race was
still a factor, even after taking into account
income and the size of the loan.
But, as you mentioned, Philadelphia is not
the only city.
We found this problem in Atlanta.
We found it in Washington, D.C.
We found it in San Antonio, Texas, and Detroit,
Michigan, and Santa Fe, New Mexico, and Tacoma,
Washington.
All over the country, 61 metropolitan areas
total, we found—
AMY GOODMAN: We’re going to have to leave
it there, Aaron, but we will link to your
piece, “Kept Out.”
And thanks so much to Rachelle Faroul.
I'm Amy Goodman with Nermeen Shaikh.
