PORTLAND FORECLOSURE CRISIS
Dylan Rivera reports that an association of Afro-Americans will hold a conference in Portland regarding high-risk loans that are affecting minorities.
The National Association of Real Estate Brokers Inc. was to sit for their routine quarterly board meeting. However, according to Clifford Turner, the President of the Association, the organizers decided to expand it to a conference because of the alarming rise in foreclosure rates across the county. Turner did not mince words when he said, “We are approaching 6000,000 African Americans in foreclosure as we speak because of high cost loans.”
The modest gathering of about forty to fifty expanded to include hundreds of policy mangers for top federal agencies, home-mortgage lenders and representatives of industry trade associations. Most likely the conference will focus on racial disparities in lending practices. The groups will attend panel discussions on Wednesday and Thursday at Double Tree Hotel, Lloyd Center. NAREB’s board will meet on Friday and declare its findings on Saturday.
Turner is of the opinion that this is not a minor issue but something with much larger stakes than merely the matter about real estates. It is going to have a snowballing effect on immediate neighborhoods and spill on to cities.
Agency reports say that The U.S. Department of Housing and Urban Development is of the opinion that the minorities are over represented in the sub-prime lending market. In affluent Afro-American neighborhoods the property owners are more than 1.5 times as likely to have a sub-prime loan than owners in low-income white areas. In areas where Latinos comprise of at least 80% of the residents, homeowners had sub-prime mortgage loans at 1.5 times the national average.
The leading mortgage lender in Portland, Wells Fargo Home Mortgage, opines that risk factors, such as borrower credit scores, loan-to-value ratio and type of property, and not race, is the cause behind differences in loan pricing. The bank made a categorical statement saying, “Race is not a factor in our pricing.” The senior Vice President of Wells Fargo’s non-prime mortgages, Stephanie Christie will take part in the scheduled panel discussion on Thursday morning.
The question ultimately comes back a full circle. Are banks to be blamed for their high-cost loans in minority neighborhoods or real estate agents for allowing their clients to be hooked on to these offers?
Turner evades a straight reply by shifting the blame from any one person to include all. He clarifies that many are pointing to them because they were the first point of contact.
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