Even if incomes of latinos were in the top 10 percent of all applicants, approval rates were lower and interest rates were higher.
San Francisco, CA -- (SBWIRE) -- 08/20/2013 -- A new study by the University of Utah showed that Hispanics who seek mortgages in the Salt Lake County are turned down twice as often as whites, and many who do get loans are charged higher interest rates than their white counterparts.
However, the University’s analysis did not consider factors that could contribute to the different outcomes for latino homebuyers, because the study stopped short of claiming that lenders knowingly discriminated against non-white mortgage applicants.
James Wood, the director of the University of Utah’s Bureau of Economic and Business Research, whose department did the study, said “the information we have certainly puts up a red flag to show there is a relationship between loan approvals, interest rates and ethnicity.”
Researchers found that the denial rate for Hispanics was 27.4 between 2006 and 2011, compared to just 14.2 percent of white mortgage applicants. One bias the researchers were able to cut out was to include all income levels. White applicants had approval rates near or above 60 percent for all incomes, but Hispanic approval rates never reached 60 percent, not even when their incomes were in the top 10 percent of all applicants combined.
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