The housing crisis and credit collapse that together comprised the Great Recession disproportionately affected minorities in America in at least two specific ways. As recent research from Rice University and Cornell University has demonstrated, black households were widely targeted by predatory lenders. Building on a major joint report from the U.S. Department of Housing and Urban Development and the Treasury Department, the researchers found that more than half of home-refinance loans for poorer African Americans were subprime, while black households were more than twice as likely as white households with comparable incomes to receive subprime loans.
Now, a new tool from the Urban Institute shows the other shoe dropping. Today, with interest rates low and policies in place that favor new homebuyers, credit is disproportionately unavailable for minorities. The households hit hardest by the housing crises have been effectively locked out of the recovery.