Women are more likely to receive sub prime home mortgage than men and these higher rates of sub prime lending make it harder for households headed by women to build wealth through homeownership. In 2005, about a third of women took out mortgages with interest rates over 7.66% (well above the average prime mortgage rate of 5.87%) compared to about a quarter of men, according to a new study released by the Consumer Foundation of America.
African American women and Latinas had the highest incidences of sub prime lending-and the gap between women of color and white men increased as income rose. Latinas earning twice the area median income were about four times more likely to receive sub prime purchases mortgages than white men with similar earnings.
“For the African American and Latino communities, women are a key driver in achieving homeownership. The high rates of sub prime lending to African American and Latino women-even those earning double the prevailing local income-may make it harder to sustain homeownership in these communities because of the high monthly payments on sub prime loans,” said Patrick Woodall, Senior Researcher at CFA.
Take action in California, and ensure all potential home owners have accurate information from lenders here. Read more about the effects of sub-prime lending on Latinas here.
