Tight underwriting has made mortgage credit hard to come by, even for the most creditworthy borrowers. But the situation is even tougher for people who come from backgrounds that avoid debt, leading to little or no credit history.
Minorities are particularly susceptible to this credit crunch, and leaders from Capitol Hill, the federal government and the real estate industry recommitted at an event this week to do something about it.
“Too many creditworthy borrowers are prevented from accessing mortgage credit because they have insufficient credit history, despite years of on-time payments on utilities, rent, and other payments that aren’t considered by current models,” National Association of Realtors® President Tom Salomone said in a statement following the event. “That isn’t just bad for the individual, who’s kept from the dream of homeownership. It’s bad for the broader economy, as young, minority, and first-time homebuyers are prevented from buying a home even though they have the means to do so responsibly.
NAR – along with the Asian Real Estate Association of America, the National Association of Hispanic Real Estate Professionals, and the National Association of Real Estate Brokers – hosted a “credit symposium” today to examine legislative proposals for alternative credit scoring and discuss efforts already underway to address the issue. Participants included Ed Golding, Principal Deputy Assistant Secretary at the Department of Housing and Urban Development, Richard Green, a Senior Advisor at HUD, and Patricia McClung, Assistant Director for Mortgage Markets at the Consumer Financial Protection Bureau.
The National Association of Real Estate Brokers (NAREB) was formed in 1947 out of a need to secure the right to equal housing opportunities regardless of race, creed, or color. NAREB has 90 chapters located nationwide and publishes annually The State of Housing in Black America (SHIBA) Report. NAREB headquarters is located at 9831 Greenbelt Rd., Lanham, MD 20706. Visit www.nareb.com for more information.