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Show Notes: Redlining Part 1

Tracy Wilson

A HOLC redlining map of Greater Atlanta. The full map is at the bottom of the post.
A HOLC redlining map of Greater Atlanta. The full map is at the bottom of the post.

On September 29, 2015, the United States Department of Justice announced that it had reached a settlement with Eagle Bank and Trust Company in a redlining case. In the words of the Justice Department's press release, "'Redlining' is the discriminatory practice by banks or other financial institutions to deny or avoid providing credit services to a consumer because of the racial demographics of the neighborhood in which the consumer lives." The Justice Department found that Eagle Bank had engaged in redlining in several major cities by, among other things, placing all 12 of its branch offices in majority-white neighborhoods and only serving the needs of borrowers in majority-white census tracts.

Just days earlier, the Justice Department also announced that it had reached a settlement with Hudson City Savings Bank in another, similar redlining case. Essentially, the Justice Department found that the bank systematically conducted its business in such a way as to avoid providing loans in neighborhoods that were predominantly black or Hispanic. Both of these settlements involved the banks' ending these practices, as well as providing outreach and financial education to minority borrowers.

We recorded this two-part podcast on redlining on September 8, 2015, about three weeks before the Justice Department settled these cases. In addition, between when we recorded and when we published part one, the city of Oakland, California, filed suit against Wells-Fargo and Evans Bank settled with the state of New York, with both cases tied to mortgage lending discrimination. Another prior redlining suit was revived in Miami. And, Fifth Third Bank settled with the Department of Justice in a redlining suit about car loans. I'm sure there are more.

This speaks to why we decided earlier this fall that we should talk about the history of redlining. It's a real, present form of discrimination that disproportionately affects minority home buyers - especially black home buyers. Its roots are in history, but it still exists today.

In our first of two parts, we talk about how the United States federal government got deeply involved in mortgage lending during the Great Depression, how mortgage lending itself evolved as a result, and how existing patterns of legally enforced segregation at the time affected the whole thing. In part two, we will talk about how neighborhood maps either enforced or simply documented racially-based discrimination in housing and mortgage lending.

If you want to read ahead before Wednesday's podcast, one source of digitized redlining maps, which we'll be talking about a lot, is Redlining Richmond.

Our listener mail is an anti-correction (no, we did not read an apology for the Stolen Generation in our Child Migrant podcast), and a real correction from David on when to mark Mexico's independence.

For more knowledge: How Mortgages Work

Episode link: A Brief History of Redlining, Part 1

A Home Owners Lown Corporation redlining map of the Greater Atlanta area.
A Home Owners Lown Corporation redlining map of the Greater Atlanta area.
A redlining map of the Greater Atlanta area.

My research:

  • "Redlining." Britannica School. Encyclop√¶dia Britannica, Inc., 2015. Web. 4 Sep. 2015. http://library.eb.com/levels/referencecenter/article/605821.
  • "Testbed for the Redlining Archives of the Californias' Exlusionary Spaces." http://salt.umd.edu/T-RACES/collaborate.html
  • Digital Scholarship Lab, University of Richmond. "Redlining Richmond." http://dsl.richmond.edu/holc/pages/home
  • Ezeala-Harrison, Fidel and Glenda B. Glover. "Determinants of Housing Loan Patterns Toward Minority Borrowers in Mississippi." Journal of Economic Issues. 2008.
  • Fryer, Victoira. "Owner-occupied homes pay quantifiable benefits for neighborhoods." Penn State News. 1/10/2014 http://news.psu.edu/story/299772/2014/01/10/research/owner-occupied-homes-pay-quantifiable-benefits-neighborhoods
  • Harrington, Scott E. and Greg Niehaus. "Race, Redlining, and Automobile Insurance Prices." The Journal of Business, Vol. 71, No. 3 (July 1998). Via JSTOR. http://www.jstor.org/stable/10.1086/209751
  • Harris, C. Lowell. "History and Policies of the Home Owners' Corporation." National Bureau of Economic Research. 1951.
  • Naveja, Christopher S. et al. "Fair lending developments: testing the limits of statistical evidence." Business Lawyer. 67.2 (Feb. 2012).
  • Nelson, Robert K. "Race and Redlining in Richmond." http://dsl.richmond.edu/holc/pages/intr
  • Ohio State University GArnder Family Map Room. "Federal Home Owners' Loan Corporation (HOLC) Maps ("Redlining Maps) for Ohio Cities." http://library.osu.edu/find/collections/maps/redlining-maps-ohio/
  • Oyez.org. "Shelley v. Kramer." http://www.oyez.org/cases/1940-1949/1947/1947_72/
  • Silverman, Robert Mark. "Redlining in a Majority Black City? Mortgage Lending and the Racial Composition of Detroit Neighborhoods." The Western Journal of Black Studies. Vol. 29, No. 1, 2005.
  • Sullivan, Brian. "HUD & Associated Bank Reach Historic $200 Million Settlement of 'Redlining' Claim." U.S. Department of Housing and Urban Development. 5/25/2015. http://portal.hud.gov/hudportal/HUD?src=/press/press_releases_media_advisories/2015/HUDNo_15-064b
  • U.S. Department of Justice. "Justice Department Reaches Settlement with Eagle Bank and Trust Company to Resolve Allegations of Lending Discrimination in St. Louis." 9/29/2015. http://www.justice.gov/opa/pr/justice-department-reaches-settlement-eagle-bank-and-trust-company-resolve-allegations
  • U.S. Department of Justice. "Justice Department and Consumer Financial Protection Bureau Reach Settlement with Hudson City Savings Bank to Resolve Allegations of Mortgage Lending Discrimination." 9/24/2015. http://www.justice.gov/opa/pr/justice-department-and-consumer-financial-protection-bureau-reach-settlement-hudson-city

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