Home mortgage lending by the numbers

A high loan denial rate for minorities does not necessarily demonstrate racial bias on the part of the lender. Recent studies have focussed on the loan denial rate as an indicator of home mortgage lenders' compliance with the Fair Housing Act, the Equal Credit Opportunity Act, and the Community Reinvestment Act. This statistic unfairly penalizes the lender who solicits and receives many applications for minorities and thus may post a higher loan denial rate than the lender who receives applications only from whites. It also disregards company-to-company differences in loan practices.