Tuesday, September 14, 2004

Anti-predatory law causes decline in real estate lending

Study finds minority, low-income borrowers hit hardest

North Carolina's 1999 anti-predatory lending law has caused lending to decline among minority and low-income borrowers, according to the findings of a study released today by the Mortgage Bankers Association.

The study, conducted by Abt Associates, analyzed the changes in lending in North Carolina and neighboring states of Tennessee and South Carolina before and after passage of the North Carolina law. Abt Associates examined lending volumes on a neighborhood-by-neighborhood basis for prime and subprime lenders.

"The study reveals, vis-?-vis the anti-predatory lending bill, the North Carolina state legislature has imposed a modern-day form of redlining on its citizens by choking off mortgage credit to minority and low-income neighborhoods," said Robert M. Couch, MBA's chairman. He also is president and CEO of Birmingham, Ala.-based New South Federal Savings Bank.


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