Mortgage Bankers Association President David Stevens said that Home Mortgage Disclosure Act data for 2012 showd a 56% denial rate for black borrowers seeking mortgages eligible to be sold to Fannie and Freddie.
“Some advocates in Washington fear changing the GSEs because they want to protect the underserved and minorities from being crowded out of the housing market,” Stevens said in a speech. “However, data clearly shows they are being left out now.”
Fannie denies that, according to a Bloomberg report.
“We believe there are serious flaws with how this HDMA data was analyzed and characterized,” spokesman Andrew Wilson said. And a November report by the Federal reserve showed a 32% denial rate for black borrowers on conventional purchase loans.
The MBA, however, insists that its figures are accurate.
“MBA stands by its analysis of HMDA data, and frankly we are disappointed at the direction of the debate which obscures the alarming trend for African American borrowers,” Stevens said in a statement. “MBA's methodology for analyzing HMDA data accurately determines denial rates and captures market trends. With respect to loans in the conventional space, we conduct a thorough and time-consuming, application-level analysis at the county level in order to ensure we capture only those conforming purchase loans that are non-jumbo.”
A leading industry group is saying that black borrowers face a disproportionate denial rate on Fannie Mae- and Freddie Mac-eligible loans, but Fannie Mae says it sees “serious flaws” in that conclusion.