The gap is significant: White residents make up only 28 percent of Baltimore’s population, yet they account for 54 percent of loan applications, and 59 percent of all loans granted. Conversely black residents make up nearly two-thirds of the city’s population, but account for only 27 percent of applications and fewer than one-quarter of all loans granted. Asian residents, according to their analysis, apply for and receive a proportional number of loans based on their population size.

Black applicants are twice as likely to have a mortgage application rejected. Even when they’re approved, black applicants are given higher interest rates and are more likely to be granted subprime loans. In some cases, the argument can be made that these differences are simply a function of economics: White families hold more wealth and have higher median incomes, which can make them more likely to pay loans back on time.

But the NCRC found that wealth gaps between races can’t be used as a catch-all excuse for the discrepancies in home lending. When it compared the lending activity in different parts of the city, the NCRC found that while finances are a driving determinant for mortgage acceptance in the suburbs surrounding Baltimore, within the city it’s race, not money, that best predicts mortgage approvals.

“While majority-white neighborhoods are sites of robust lending activity, majority-black neighborhoods are consistently excluded from lending activity,” the study’s authors write. In fact, the best predictor of mortgage approval was how many white residents lived in a particular neighborhood. In poorer, more heavily black neighborhoods, lending activity was diminished, regardless of income level. That’s a problem in a city where 63 percent of the population is black.

It’s a bit of a vicious cycle. Some lenders may see high-poverty, high-minority tracts as a bad bargain, areas where home values aren’t sure to rise. But the lack of lending in such areas is precisely what contributes to the economic stagnation and growing inequality of the city and cities like it. Homeownership can help increase wealth, it can invite investment in the form of small businesses and services, and it can change the culture of and commitment to a neighborhood. For now, wide swaths of Baltimore won’t have that opportunity.

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