Report: Concerns About Racial Lending Practices of SC Lenders
A new analysis from the nonprofit newsroom The Markup ranked a Charlotte-area lender among the worst in its study on racial disparities in lending.
The survey released by The Markup on Wednesday found that in 89 metropolitan areas across the United States, minority applicants were more likely to be denied conventional mortgages than similarly qualifying white applicants, according to 2019 federal data from The Home. Mortgage Disclosure Act.
The markup said that in 2019, the Indian Land, SC-based motion mortgage was 110% more likely to reject black and Latino applicants than similarly qualifying whites.
Movement Mortgage disputed the findings. In a statement to The Markup, the company said using Home Mortgage Disclosure Act data to assess racial disparities leads to incomplete results that can be “misleading and damaging.”
“HMDA data does not take into account borrower credit scores, which are among the most important factors in mortgage lenders‘ credit decisions,” the company said. “Without this information, it is impossible for a third party to determine that a lender is disproportionately denying a protected category of borrowers.”
Movement Mortgage did not respond to Observer’s request for comment on The Markup report on Wednesday.
More than 5,500 businesses reported data to the federal government in 2019 for every loan application they processed, according to The Markup report. Only the first 1% of lenders processed enough requests for a statistical analysis of their practices.
The markup said it found more than 24 companies that had statistically significant credit disparities, including Movement Mortgage.
The disparities The margins found for individual lenders mirrored those of the industry as a whole.
Across all lenders, potential black, Latino, and Asian borrowers have been denied mortgage loans at higher rates than white applicants, despite similar lending qualifications such as debt-to-income ratio.
Black applicants in the Charlotte metropolitan area were 1.5 times more likely to be rejected than white applicants. The city is doing better than others in the Carolinas: In Wilmington, black applicants were 2.4 times more likely to be refused a loan. In Florence, SC, this probability was 2.5 times higher.
The 2019 data used for the analysis only includes statistics reported to federal agencies for conventional home loans.
About the motion mortgage
Movement Mortgage was founded by former Carolina Panthers close member Casey Crawford in 2008. The company has more than 4,000 employees, according to its website, and has added hundreds of new employees in recent years.
The company has advocated for increased homeownership rates for blacks on its website and social media pages.
Movement Mortgage’s nonprofit investment arm, the Movement Foundation, has funded the establishment of the Movement School, a charter school network in Charlotte, as well as affordable housing and healthcare initiatives.