Because of the COVID-19 pandemic, the “Fed” dropped interest rates. That meant homeowners could refinance their mortgages and save money – but it wasn’t a win for everyone.
A suspiciously large percentage of denied applications for refinancing were from Black homeowners – and one bank is being accused of systematic discrimination.
Wells Fargo rejected 53% of refinance applications submitted by Black homeowners. In comparison, only 28% of white homeowners were denied.
They approved white homeowners earning $63,000/year, but denied Black homeowners making $168,000/year!
Most banks discriminate against Black refinancing applicants, but there’s usually about a 10% gap. Wells Fargo rejected 24% more Black applicants than white!
Refinancing means smaller monthly payments and more money to invest – or survive an emergency like the pandemic. This discrimination further grows the racial wealth gap.
This is why a federal lawsuit has been filed against Wells Fargo – on behalf of Aaron Braxton, a Black homeowner coming forward about discrimination he faced.
Stories like this remind us that white-owned banks don’t have Black wealth in mind, and why so many of us switch to Black-owned banks or credit unions. Even if we do, however, it doesn’t solve the larger problem – anti-Blackness in this economy is systemic!