New Jersey Institute for Social Justice Resources

Chicago, near 42nd and east of State Street, September, 2005

New Jersey Institute for Social Justice resources

November 23, 2005

Yahonnes,

I’ve revised the code to produce a new set of lender rankings. Let me know how this looks.

best,

Elvin

November 16, 2005

Yahonnes,

I’ve written code that reads in the raw Home Mortgage Disclosure records for the state of New Jersey, and ranks the individual lenders

according to their racial disparity in the granting of rate-spread loans. First, we narrow the focus to only those lenders reporting at least

one hundred total applications. Then we calculate the percentage of African-American originations that are made at rates above the

reporting threshold; we divide this percentage by the percentage of non-Hispanic White originations made on rate-spread terms. In cases

where no rate-spread loans are made to non-Hispanic Whites, this type of calculation is mathematically impossible (any number divided by

zero is infinity), so I’ve simply written the code to assign these cases “100” values. But the code also prints out the absolute number of

African American (and Latino/Latina) rate spread loans, so you can see the many cases in which a lender made no rate-spread loans to

Whites, but only a handful of rate-spread loans to minorities. The crucial institutions, of course, are those with a large number of rate-

spread loans to African Americans or Hispanics, and high Black/White or Hispanic/White ratios. You’ll note that the lenders with the

highest ratios (above ten) are, in most cases, simply making very few rate-spread loans at all, but doing so only with African Americans.

Further down the list are somewhat lower ratios (from 5.9, Wells Fargo, to 2.8, Countrywide) but based on significant numbers of

originations to African Americans. Farther down the list are “equal opportunity” predators like Fremont Investment and Loan, where

four-fifths of all originations are rate-spread, but there is almost no Black/White or Hispanic/White disparity. All of these statements

apply to originations regardless of loan purpose, do not distinguish between first- and second-lien loans, but do exclude loans purchased

by institutions, applications received in late 2003 but acted on after January 1, 2004, and FHA/VA-insured loans.

ratios.xls, an Excel file with New Jersey lenders ranked by Black/White ratio

ratios.lst, a SAS printout (open this from within Word)

ratios.sas, the SAS command file, in case you’re interested in how things are defined.

Chicago, where the Robert Taylor Homes once stood, September, 2005

November 7, 2005

Yahonnes,

I’ve prepared a set of files for you in case you are able to get access to SAS, statistical analysis system software. If you can, create a

directory, “c:\sasdat\njisj”. Download the files below into this directory and run the SAS code, which will produce a series of

crosstabulations of first-lien conventional originations statewide, by race/ethnicity and income. The code also compares the rate-

spread and HOEPA status of first-lien conventional originations, and presents the race/ethnicity and income categories of first-lien

conventional HOEPAs. If you don’t have access to SAS, then just use the second file below to follow the logic that I’ve used to define

race/ethnicity categories, and let me know what additional cross-tabulations would be most useful.

as defined in the 2004 HMDA Cds

Yaletown, Vancouver, August 2004.

Copy Left 2005, Elvin K. Wyly.