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Lenders that aren’t serving minorities for home loans

AARON GLANTZ, EMMANUEL MARTINEZ and JENNIFER GOLLAN | 2/19/2018, 3:54 a.m.
Across America, a troubling pattern emerges in data analyzed by Reveal from The Center for Investigative Reporting
Capital One Bank branch in Austin. Harry Cabluck

Ruoff Home Mortgage – “A great name to know when you need a mortgage”

Headquarters: Fort Wayne, Indiana

The skinny: Since the housing bust, family-owned Ruoff Home Mortgage has originated the most loans in Indiana and is one of the fastest-growing mortgage lenders in the country. Although its biggest market was Indianapolis, with a large African American community, the company made 92 percent of its 5,300 conventional home loans to Whites in 2015 and 2016.

The response: A spokeswoman for the company did not respond to two emails and a voicemail requesting comment.

The Community Reinvestment Act allows banks to draw lines on maps to define “assessment areas,” where regulators should scrutinize their lending. Some of those that lend almost entirely to Whites drew service areas that excluded neighborhoods where large numbers of people of color live.

First National Bank in Staunton – “Community banks care about their communities”

Headquarters: Staunton, Illinois

The skinny: The St. Louis metro area is racially diverse, home to more than 500,000 African Americans. But over two years, none of the 324 home loans made by First National Bank in Staunton went to an African American or Latino. All nine of its branches are in neighborhoods of the metro area that are at least 89 percent White. First National told regulators who enforce the Community Reinvestment Act that it intends to serve two overwhelmingly White counties in the St. Louis area, stopping at the county line of St. Clair County – home to East St. Louis, a predominantly Black city.

The response: A First National official did not respond to two emails and a voicemail requesting comment.

First Federal Savings and Loan Association of Greene County – “People you know, the people you can trust!”

Headquarters: Waynesburg, Pennsylvania

The skinny: Like St. Louis, Pittsburgh is a racially diverse city with a large population of African Americans, but First Federal Savings and Loan doesn’t serve them. Its branches all are in majority-White neighborhoods. Of the 554 conventional mortgages it issued in 2015 and 2016, 99 percent went to Whites. Like First National Bank in Staunton, Illinois, it crafted an assessment area under the Community Reinvestment Act that includes overwhelmingly White suburban and rural counties, but stops at the Allegheny County line, where large numbers of people of color live.

The response: In a letter to Reveal, the company’s president and chief executive, Judi Goodwin Tanner, said that wasn’t a problem: “While this statistic alone might certainly be used to attempt to cast First Federal in a negative light,” she said, federal regulators had found “no evidence of discriminatory or other illegal credit practices.” In her letter, Tanner stated that the county where the bank is headquartered is 94.8 percent White. It said the bank had approved nearly all non-White applicants who sought a residential mortgage.

The Justice Department and U.S. Department of Housing and Urban Development rarely sue banks for redlining. Only a handful of cases were brought under President Barack Obama. None have been brought under President Donald Trump. These are two banks that had cases brought against them and the results: