Reasons for refusing mortgages ‘do not explain racial disparity’

Minneapolis Fed’s study challenges explanations given for why people of colour are treated differently

 House and dollars

Lenders’ reported reasons for denying mortgages do not adequately explain why an outsize proportion of refusals are aimed at people of colour, a new study has found. 

The research was published on January 18 by the Federal Reserve Bank of Minneapolis. The authors – Ben Horowitz, Kim-Eng Ky and Libby Starling – had previously analysed confidential data compiled under the Home Mortgage Disclosure Act (HMDA). This data, to which the Federal Reserve has privileged access, included “credit scores and

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