Minorities, low-income hit by “declining market” label
April 1st, 2008, 4:48 pm · Post a Comment · posted by mistywilliams
Lenders have classified most of Maricopa and Pinal counties as a “declining market” in recent months.
It’s a label that’s been attached to many major metropolitan areas throughout the country. It requires home buyers to come to the table with 5 percent more cash for a downpayment, making it that much tougher to qualify for financing in an already dour lending environment.
Now, industry professionals are voicing concern that the designation is creating even greater hurdles to homeownership for minorities and low-income families.
“The consequence of these policies is a near complete suspension of financing resources to communities that need it most,” National Association of Hispanic Real Estate Professionals chair Felix DeHerrera said in a statement.
The organization, along with the Asian Real Estate Association of America and National Association of Real Estate Brokers, conducted a survey of 1,135 combined members. Here are some of the survey’s findings:
* 27 percent of respondents said they worry lenders may act too quickly to identify minority neighborhoods as declining markets;
* 69 percent say for every deal they close, they have to turn away two to four customers who can’t qualify under declining market standards; and
* 35 percent say the policies have had a disparate impact on minority and low-income areas.
