Minorities Pay Higher Mortgages
— reported by Hispanic Business
High-interest home loans are costing California minorities an estimated $50 million more per month than white borrowers, according to a report based on newly available home-loan data.
The study released Thursday by the San Francisco-based California Reinvestment Coalition found that lenders originated 264,348 higher-cost home loans, defined as those charging 8 percent or higher, in California in 2004.
African Americans were more than twice as likely as white borrowers to get higher-interest home purchase or refinance loans, and Latino borrowers were three times as likely. Residents of minority neighborhoods were four times as likely to obtain higher-cost home-purchase loans than white neighborhoods, and low-income neighborhoods were three times as likely as upper-income neighborhoods.
The average higher-cost home loan carried a 9.81 percent rate, compared to the 2004 average of 5.84 percent for a 30-year fixed rate loan. That translates to a monthly difference of $691.76 on mortgage payments.