SOC 201 Chapter Notes - Chapter 14: Home Mortgage Disclosure Act, Credit Risk
Document Summary
For example, in the early 1990s, the federal reserve (the government agency charged with overseeing the banking industry) found that banks distinguished between loan applicants based on criteria other than money. As figure 14. 2 shows, at all levels of income, whites found it easier to obtain mortgage loans than blacks and hispanics. Being fortunate enough to obtain a mortgage does not necessarily resolve the problems faced by minority borrowers. One of the major advantages of owning a home is building equity (that is, the market value of the property minus the value of the mortgage yet to be paid off). Equity is a form of wealth, something that can be turned into cash either by selling the property outright or by refinancing the mortgage. When it comes to refinancing, some people find that the dollar amount of the equity they have invested in their homes doesn"t amount to what it would have had someone else been doing the investing.
