<br><br><div class="gmail_quote">---------- Forwarded message ----------<br>From: <b class="gmail_sendername">Dante-Gabryell Monson</b> <span dir="ltr"><<a href="mailto:dante.monson@gmail.com">dante.monson@gmail.com</a>></span><br>
Date: Fri, Dec 2, 2011 at 9:48 AM<br>Subject: “ghetto loans” - Pushed Minorities Into Subprime Mortgage Loans when many qualified for Prime Loans<br>To: <a href="mailto:econowmix@googlegroups.com">econowmix@googlegroups.com</a><br>
<br><br><p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:5px;padding-right:0px;padding-bottom:5px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:rgb(255,255,255);line-height:1.25em;color:rgb(102,102,102);font-family:Calibri,'Trebuchet MS','Lucida Sans',Arial,sans-serif">
</p><h1 style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:0px;padding-right:0px;padding-bottom:10px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;font-weight:normal;line-height:1.15em;color:rgb(216,159,0)">
<a href="http://thinkprogress.org/economy/2011/12/01/379332/former-banker-subprime-pushed/" target="_blank"><font size="2">http://thinkprogress.org/economy/2011/12/01/379332/former-banker-subprime-pushed/</font></a></h1>
<h1 style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:0px;padding-right:0px;padding-bottom:10px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;font-weight:normal;font-size:1.7em;line-height:1.15em;color:rgb(216,159,0)">
<a href="http://thinkprogress.org/economy/2011/12/01/379332/former-banker-subprime-pushed/" target="_blank">Former Chase Banker Admits His Bank Pushed Minorities Into Subprime Mortgage Loans</a></h1>
<p></p><p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:5px;padding-right:0px;padding-bottom:5px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:rgb(255,255,255);line-height:1.25em;color:rgb(102,102,102);font-family:Calibri,'Trebuchet MS','Lucida Sans',Arial,sans-serif;font-size:15px">
By <a href="http://thinkprogress.org/author/pat-g/" style="text-decoration:none;color:rgb(51,51,51);font-weight:bold" target="_blank">Pat Garofalo</a> on Dec 1, 2011 at 9:20 am</p><div style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:rgb(255,255,255);width:589px;float:right;line-height:1.5em;font-family:Calibri,'Trebuchet MS','Lucida Sans',Arial,sans-serif;font-size:15px">
<p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:5px;padding-right:0px;padding-bottom:5px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:transparent;line-height:1.5em">
<img src="http://thinkprogress.org/wp-content/uploads/2011/12/chasebank.jpg" alt="" title="" style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:6px;padding-right:0px;padding-bottom:0px;padding-left:10px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:transparent;float:right" height="223" width="224">One of the most pernicious practices in which the nation’ biggest banks engaged during the lead up to the financial crisis was pushing minority borrowers into subprime loans, even when many of them qualified for prime loans. Wells Fargo had perhaps the most horrifying practices in this department, calling the subprime loans that they pushed in poor, black neighborhoods “<a href="http://thinkprogress.org/economy/2009/06/08/172810/wells-fargo-subprime-bank/" style="color:rgb(51,51,51)" target="_blank">ghetto loans</a>.”</p>
<p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:5px;padding-right:0px;padding-bottom:5px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:transparent;line-height:1.5em">
This rampant predatory lending helped inflate the housing bubble; a Center for American Progress investigation actually <a href="http://thinkprogress.org/economy/2009/09/15/172933/racial-disparities-tarp-banks/" style="color:rgb(51,51,51)" target="_blank">found huge racial disparities</a> in lending at the big banks that wound up getting bailed out, with minority borrowers <a href="http://www.americanprogress.org/issues/2009/09/pdf/tarp_report.pdf" style="color:rgb(51,51,51)" target="_blank">far more likely</a> to receive high-priced loans.</p>
<p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:5px;padding-right:0px;padding-bottom:5px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:transparent;line-height:1.5em">
One former banker for Chase — James Theckston — told the New York Times’ Nick Kristof that not only did his bank push minority borrowers into higher-priced loans, but senior executives then tried to <a href="http://www.nytimes.com/2011/12/01/opinion/kristof-a-banker-speaks-with-regret.html?_r=1" style="color:rgb(51,51,51)" target="_blank">cover up the racial disparity</a> in their banks’ lending:</p>
<blockquote style="margin-top:10px;margin-right:50px;margin-bottom:10px;margin-left:50px;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:transparent;quotes:none">
<p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:5px;padding-right:0px;padding-bottom:5px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:transparent;line-height:1.5em">
One memory particularly troubles Theckston. He says that some account executives earned a commission seven times higher from subprime loans, rather than prime mortgages. So they looked for less savvy borrowers — those with less education, without previous mortgage experience, or without fluent English — and nudged them toward subprime loans.</p>
<p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:5px;padding-right:0px;padding-bottom:5px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:transparent;line-height:1.5em">
<b style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:0px;padding-right:0px;padding-bottom:0px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:transparent;font-weight:bold;background-repeat:initial initial">These less savvy borrowers were disproportionately blacks and Latinos, he said, and they ended up paying a higher rate so that they were more likely to lose their homes. Senior executives seemed aware of this racial mismatch, he recalled, and frantically tried to cover it up.</b></p>
</blockquote><p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:5px;padding-right:0px;padding-bottom:5px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:transparent;line-height:1.5em">
“The <a href="http://www.nytimes.com/2011/12/01/opinion/kristof-a-banker-speaks-with-regret.html?_r=1" style="color:rgb(51,51,51)" target="_blank">bigwigs of the corporations knew this</a>, but they figured we’re going to make billions out of it, so who cares? The government is going to bail us out. And the problem loans will be out of here, maybe even overseas,” Theckston explained.</p>
<p style="margin-top:0px;margin-right:0px;margin-bottom:0px;margin-left:0px;padding-top:5px;padding-right:0px;padding-bottom:5px;padding-left:0px;border-top-width:0px;border-right-width:0px;border-bottom-width:0px;border-left-width:0px;border-style:initial;border-color:initial;outline-width:0px;outline-style:initial;outline-color:initial;vertical-align:baseline;background-image:initial;background-color:transparent;line-height:1.5em">
In 2006, Chase made high-price loans to 16.4 percent of white borrowers, while <a href="http://www.americanprogress.org/issues/2009/09/pdf/tarp_report.pdf" style="color:rgb(51,51,51)" target="_blank">nearly half of black borrowers</a> and more than one-third of Hispanic borrowers received high-price loans. These disparities help explain why, according to a new report from the Center on Responsible Lending, Latinos and blacks <a href="http://thinkprogress.org/economy/2011/11/18/372517/latinos-african-americans-housing-crisis/" style="color:rgb(51,51,51)" target="_blank">are twice as likely</a> to have been impacted by the housing crisis as whites. In fact, “<a href="http://thinkprogress.org/economy/2011/11/18/372517/latinos-african-americans-housing-crisis/" style="color:rgb(51,51,51)" target="_blank">approximately one quarter</a> of all Latino and African-American borrowers have lost their home to foreclosure or are seriously delinquent, compared to just under 12 percent for white borrowers.”</p>
</div>
</div><br><br clear="all"><br>-- <br>P2P Foundation: <a href="http://p2pfoundation.net" target="_blank">http://p2pfoundation.net</a> - <a href="http://blog.p2pfoundation.net" target="_blank">http://blog.p2pfoundation.net</a> <br>
<br>Connect: <a href="http://p2pfoundation.ning.com" target="_blank">http://p2pfoundation.ning.com</a>; Discuss: <a href="http://lists.ourproject.org/cgi-bin/mailman/listinfo/p2p-foundation" target="_blank">http://lists.ourproject.org/cgi-bin/mailman/listinfo/p2p-foundation</a><div>
<br>Updates: <a href="http://del.icio.us/mbauwens" target="_blank">http://del.icio.us/mbauwens</a>; <a href="http://friendfeed.com/mbauwens" target="_blank">http://friendfeed.com/mbauwens</a>; <a href="http://twitter.com/mbauwens" target="_blank">http://twitter.com/mbauwens</a>; <a href="http://www.facebook.com/mbauwens" target="_blank">http://www.facebook.com/mbauwens</a><br>
</div><br>