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| | Issue #21.28 :: 07/09/2008 - 07/15/2008 | NAACP Events Target Discriminatory Lending
Lawsuit Says Blacks More Likely to Be Issued High-Interest Loans
| BY ERIC K. WARD
| The South Carolina chapter of the NAACP participated in what might be called a nationwide speak out July 2 against mortgage lenders that the NAACP alleges have discriminated against blacks and other minorities.
In Columbia, Chicago, Baltimore and other cities, NAACP representatives held news conferences on the 44th anniversary of the signing of the Civil Rights Act of 1964 to denounce and call for an end to the allegedly discriminatory lending practices.
The media events took place outside the offices of some of the lenders and in neighborhoods where some victims of what the NAACP calls predatory lending live.
The Columbia demonstration occurred at 1201 Main St. in the shadows of the Capitol Center, which houses Chase Home Mortgage and SunTrust Mortgage locations.
Chase and SunTrust are among 17 major lenders that the National Association for the Advancement of Colored People is suing in federal court. The case was filed in Los Angeles in 2007.
In its lawsuit, the group charges that the financiers systematically discriminated against minorities, mostly blacks, by issuing them subprime and other high-interest loans at disproportionately large rates compared to white borrowers.
As a result, many victims of the predatory lending have had their homes foreclosed on, according to the suit.
Some studies support the allegations.
Sue Berkowitz, director of the Columbia-based South Carolina Appleseed Legal Justice Center, cited the studies at the Columbia news conference. “It’s just horrendous what’s going on,” said Berkowitz, whose center advocates for low-income people, “and folks are not protecting themselves in court because they don’t understand the process.”
Opening the briefing, state NAACP director Dwight James said the late civil rights leader Martin Luther King Jr. dreamed that his children would live in a nation in which they would be judged by the content of their character rather than the color of their skin. “That’s how people walking into a bank should be judged, too,” James said.
As he spoke at a podium, about a dozen people stood behind James holding signs that read “Campaign for Economic Justice. Banks Display Hate When They Discriminate.”
Berkowitz said some black borrowers who were qualified for regular loans were steered into high-interest mortgages.
Added James, “The only difference was the color of their skin.”
The discrimination was pronounced in South Carolina, according to a 2007 report by the National Community Reinvestment Coalition, headquartered in Washington, D.C., and dedicated to economic justice.
In racial disparities in home lending, the report names Charleston as the worst metro area in the nation and Greenville as the 10th worst.
James said the lenders must end their discriminatory practices and make amends to their victims. Asked what specifically the NAACP is seeking in court, he could not say.
Tom Kelly, a Chicago-based spokesman for Chase, says the lenders have filed a motion asking that the case be dismissed. “We believe that we price our loans fairly because they’re based on borrowers’ financial qualifications,” Kelly says. He would not discuss specific allegations in the lawsuit.
Headquartered in Atlanta, SunTrust would not answer questions but provided a statement that says the accusations are meritless. “And we are consistently among the top-rated financial institutions in the NAACP’s annual financial services industry survey,” the statement says. | |
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