Today’s jobs report indicated that only $169,000 new jobs have been created. This weak “recovery” has had a disastrous impact on African-Americans, and nowhere is that fact made more apparent than in the housing data. Bloomberg reported on Tuesday that African-American home ownership has hit an 18 year low.
For blacks in the U.S., 18 years of economic progress has vanished, with a rebound in housing slipping further out of reach and the unemployment rate almost twice that of whites. The homeownership rate for blacks fell from 50 percent during the housing bubble to 43 percent in the second quarter, the lowest since 1995. The rate for whites stopped falling two years ago, settling at about 73 percent, only 3 percentage points below the 2004 peak, according to the Census Bureau.
At the crux of the housing crisis in Black America are the high cost loans that some 40% of African-American borrowers took out during the housing bubble. Sub-prime, high cost mortgages–which were at the crux of bundled derivative securities scam– were targeted to African-American and Latino communities. In the end, Wall Street and lenders made billions by pushing these loans on African-Americans, then bundling them and pawning them off on pension funds and investment houses overseas as highly rated securities.
In 2012, Wells Fargo, the nation’s largest home mortgage lender, agreed to pay at least $175 million to settle accusations that its brokers discriminated against African-American and Hispanic borrowers.
There were loan modifications programs put in place, but the move came late, after many people had already been foreclosed on. Also, there were numerous complaints that banks were slow walking the process and not acting in good faith.