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New Study Confirms Racial Bias In Mortgage Approval Algorithms
A new analysis of data from over 2 million mortgage applications confirm that racial bias is baked in to the approval algorithms. While all minorities are affected, the bias most heavily impacts the black community. According to the study, black people were 80% more likely to be rejected for a home loan than white people with a similar financial profile.
30 Year Fixed Mortgage Rate
| Today’s Rate | 2.942% |
| Change From Yesterday | -0.010% |
| Change From One Week Ago | -0.003% |
| Change From One Year Ago | -0.120% |
15 Year Fixed Mortgage Rate
| Today’s Rate | 2.323% |
| Change From Yesterday | 0.098% |
| Change From One Week Ago | 0.122% |
| Change From One Year Ago | -0.335% |
Today’s Financial Headlines
Systemic Racism In The Mortgage Industry
Minorities have frequently complained that they are denied for mortgages that their white friends and colleagues easily qualify for. The mortgage industry has long denied those claims, stating that their underwriting is fair and unbiased. A new study takes the complaint from incidental reports to hard numbers. According to the analysis, minorities are 40 to 80% more like to be rejected for financing than their white counterparts.
Global Instability Impacts Interest Rate
Mortgage rates have always been hard to predict, but several current factors in the global and US markets are making it harder than usual. Despite a strong US economic recovery of jobs and income, inflation and instability are still driving rates down. The resurgence of Covid throughout the world is casting doubt on economic markets. Increasing political instability across many regions of the world, including the collapse in Afghanistan, is also a major factor affecting economic uncertainty.
A New Type of Credit Score Measures Your Ability To Survive Financial Disasters
A new measure of financial fitness has been introduced to loan writers. It is called the FICO Resiliency Score. This score is based on various factors that can predict who will survive financial disasters. As the pandemic continues to rage and the economic recovery hangs in the balance, this type of financial resilience becomes increasingly important to lenders.