‘Redlining never really went away’: Black Rhode Islanders still face racism when buying a home
Within three months, Garlington found the perfect place: a three-bedroom, two-bathroom home in the Wanskuck neighborhood of Providence.
But the process of closing the house, which should have taken about 45 days, took more than nine months.
“It got to the point where I told my real estate agent I never wanted to look for another house again,” Garlington said. The biggest hurdle was having to repeatedly prove to the underwriter how much money she was making, despite the paperwork showing she could pay the mortgage payments on her $70,000-a-year salary.
A 2019 loan from a local university caused another problem: A credit report showed she still owed $3,900. But she never took the course and says she never received the loan money.
“It should never have been on my credit report,” Garlington said. A letter to the underwriter, explaining the situation, should have sufficed, she said, “But they [the underwriter] forced me to pay, otherwise I would lose the opportunity to get the house.
She wonders if white homebuyers face similar issues.
“This is what racial discrimination looks like when trying to buy a house in Rhode Island,” she said.
Disparities in home ownership between Blacks and people of all other races persist. In the United States, more white, Asian and Hispanic Americans have owned homes than black Americans, according to a recently released report by researchers at Brown University titled “The State of Black Rhode Island Homeownership.”
And the disparity is particularly bad in Rhode Island. Overall, homeownership in the Ocean State is about the same as in the United States as a whole: 64% of all Americans owned a home in 2019, and 62% of all Rhode Islanders.
The disparity becomes evident when the data is disaggregated by race. In the United States, 73% of white Americans owned a home in 2019, compared to 42% of black Americans. But in Rhode Island, 62% of all residents owned a home in 2019, compared to just 34% of Black Rhode Islanders, according to Dr. Akilah Dulin, professor of behavioral and social sciences and lead researcher on the report, which was paid for by United Way of Rhode Island.
In 2019, there were 25,024 black households in Rhode Island. Of those households, 8,571 were owner-occupied and 16,453 were renter-occupied, Dulin said.
“My desire to experience Black Rhode Island began when I thought of moving here myself. When I started researching what it was like to be Black in Rhode Island, I thought it was an undesirable place,” said Dulin, who moved to Rhode Island in 2012 from Alabama.
The housing crisis in Rhode Island, especially among black residents, is reaching a tipping point. According to the Rhode Island Coalition to End Homelessness, more than 300 people slept outside or in their cars on any given night in February alone. The real estate market is so hot that fewer first-time home buyers are able to compete. The median price for a single-family home in Rhode Island is $370,000 and the median price for a multi-family home is $399,900, according to the Rhode Island Association of Realtors.
Proponents say home ownership, which could create generational wealth, is the long-term answer to ending the housing crisis, but due to federal, state and local policies, black Americans have had limited opportunities to own homes. Historical barriers persist, according to Dulin.
“Education is part of it. And that’s important. But education without resources and without removing systemic barriers won’t have the kind of tangible impact we need that will be sustainable,” Dulin said.
In the report, she recommends increasing access to low-value mortgage assistance (about $10,000 to $70,000) for single-family properties owned by black people. She said a mortgage relief program, when combined with a homebuyer education program, could reduce the black-white homeownership gap by at least 12 %.
These programs, aimed at future black homeowners, “are a way to close the gap and help in our current housing crisis.”
Historical barriers to homeownership for Black Rhode Islanders date back to the 1930s, when red lines were drawn on maps to indicate “unsafe neighborhoods” in Providence, the researchers found. Lenders were less likely to approve mortgages or offer great rates in these regions, which were predominantly black.
Advocates lobbied for fair housing practices, and after 30 years, the Rhode Island Fair Housing Practices Act was passed in April 1965, which allowed people to apply for housing based on the discrimination.
But that didn’t stop the redlining.
“Black people are more likely to be denied home loans, offered subprime loans, or loans with higher interest rates despite their creditworthiness,” the report read. This, in turn, can damage a person’s credit.
Kobi Dennis, chief operating officer of the YMCA of Greater Providence, said the most staggering part of the data for him showed black people had lower credit scores than their white counterparts. “It is proven in this report. There is no more debate,” he said. “So what are we going to do about it?”
In 2014, the city of Providence sued Santander Bank for redlining, alleging the bank had increased its mortgage lending in predominantly white neighborhoods by 25% and cut its lending to people of color by 63%. While the lawsuit was dropped, the bank paid $1.3 million to the Providence Community Library, AS220 (a downtown arts and culture organization), and Rhode Island Local Initiatives Support Corp., which was a new grant program that helped pay mortgage down payments and closing costs for “low-to-moderate income Providence residents.”
“None of that money was used to specifically stimulate black homeownership, which is why they were sued in the first place,” Dennis said.
Five years later, the Rhode Island Commission for Human Rights received 330 reports of Fair Housing Practices Act violations, and nearly a quarter of the discrimination complaints were race-related.
Dulin explained that even with the same application profile as whites, black Americans who applied for mortgages were 50 to 120 percent more likely to be denied loans than white mortgage applicants. She said real estate agents generally showed fewer homes to black people, were directed to minority neighborhoods and received less help while searching.
In 2020, 1,288 blacks and 16,037 whites in Rhode Island submitted mortgage applications to purchase a home. But 10% of black applicants were turned down while 6% of white applicants were turned down.
“It goes way beyond financial literacy,” Dulin said. “It’s like the red line never really went away.”
The pandemic, she said, has only exacerbated the problem. Dulin found that nearly 20% of black homeowners said they were behind on mortgage payments, and few were aware of the mortgage forbearance options available during the pandemic.
Daynah Williams is director of homeownership services and asset creation at NeighborWorks Blackstone Valley in Woonsocket, which offers free homebuyer classes and personalized budget assessments with financial advisors.
“There are some people in the community who are not included in anything about education,” she told the Globe. “We tell them, ‘Buy a house. Gather your credit. That’s great, but how do you maintain it? We are that sounding board.
As a black woman, however, Williams said being able to buy a home isn’t just about financial literacy. “In other jobs, I clearly saw how my own earning power was not equal to that of my white counterparts, for the same job and for the same skill set.”
“When you’re a person of color and you finally get to that point, after living in survival mode, it’s emotional,” she said.
“It often happens that many of us are not allowed in certain areas. We’re directed and we don’t even realize it’s happening,” she said. “The practices of the 1800s and the red lines of the 1930s still affect us in this state today.”
Back in the Wanskuck section of Providence, Garlington ended up closing his house in mid-February. But now she has to hire a lawyer and try to recover the money she paid for a loan she never received for a class she never attended just to get the house she was buying approved. with his daughter in the first place.
She joked, “In what world is that fair?”
Alexa Gagosz can be contacted at [email protected] Follow her on Twitter @alexagagosz and on Instagram @AlexaGagosz.