Consumer groups must be getting bored with the current foreclosure fault-fest. A recent article on Women’s eNews© claims that advocacy groups including the Consumer Federation of America believe that gender bias in mortgage lending is “quite common.” According to Allison Stevens, the author of the article, “The government currently screens for disparities based on race and ethnicity, but not on gender, making it difficult to assess precisely how widespread this type of discriminatory lending is.”
Um, has this woman ever seen a 1003 mortgage app? And what part of “Information for Government Monitoring Purposes” does she not understand? It’s all right there, Part X, that gathers ethnicity, race, and sex information for monitoring lender “compliance with equal credit opportunity, fair housing and home mortgage disclosure laws.”
So that takes care of the government monitoring question. Now, how about approvals — are women getting bounced for simply being women?Don’t think so –underwriting is largely done with programs like Loan Prospector and Desktop Underwriter; those computerized suckers don’t give a rat’s, uh, tail what the applicant’s gender is, but they do like to see enough income to make a payment and a few months’ reserves.
Finally, lenders are businesspeople and discrimination is simply bad business. If someone qualifies for a full-doc prime loan, why on earth would anyone quote them an Alt-A or subprime deal? Unless they only sell subprime loans or hard money? LOs can price in a decent profit regardless of the product offered, but would be far more likely to lose the deal to the guy down the street (or the next URL) by pricing higher than warranted. To make the assumption that gender discrimination is “common,” the logical conclusion is that it is also “common” for women to work with lenders who only offer subprime products, that it is “common” for women to forego shopping for a good deal (like that will ever happen), and that it is “common” for women to be less intelligent or discerning than men (don’t get me started here).
One of these groups took a 2006 government report and interpreted the data to conclude that women as a group pay more for mortgages than men with similar credit scores. But the government did not in fact conclude that the disparity was due to discrimination by lenders. As we all know, credit is only one part of a loan application. It’s an unfortunate fact that women in this country as a group earn less than men, particularly those whose career is interrupted by family obligations. And it’s no secret that nearly half of American marriages end in divorce and that it’s the woman who takes the brunt of the financial hit. Spousal support has become an anachronism, and child support is often unreliable and inadequate. Additionally, women are disproportionately represented in service industries which are characterized by low job security and minimal benefits.
So you have a single mom, re-entering the workforce (maybe she gets credit for her new income, maybe she doesn’t until she’s been on the job a couple of years), and she gets child support the underwriter can’t count unless the applicant’s been receiving it — on time — for a while. She will in all likelihood have a harder time getting a mortgage than her ex.
And that’s a crappy deal. And it should be changed, but not by insulting women, saying that we are too helpless and dumb to get loans without special protection. Gender discrimination and income disparity isn’t about lending — it’s about life.
Not a bad article… for a woman!
Just kidding (don’t hit me!) This was a great piece. There is a disparity, but LOs are not the cause. Excellent reporting, Gina.
I don’t agree with what is said in the above reading. I don’t believe that womem are discriminated upon. Sorry! I do believe that some women have hard times qualifying due to the fact that they have been off work for some time. But it’s everyone’s choice if they are going to stay home and take care of children, or go and work. When I had my son, I was back at work within 6 months and I shifted my hours around in order to only have my son in daycare for a couple of hours a day. His son worked days and I worked swing. We would have switched those hours around if needed. I’ve been single mom for 9 years, son being 11 now. I have my own home, qualified by myself. I don’t believe in alimony either.. unless the man forced the woman to stay home. I see too many woman nowadays play off that. In the world today, you have to be strong.. whether or not you are a woman or a man.. the weak will not survive in any job anywhere! There are a lot of men out there now that don’t work… they sit on their butts and do nothing, while the woman work their hearts out. Soon, the men won’t be able to qualify by themselves, since they don’t have any work history.. and that would have been their choice. Thanks!
It’s not discrimination. It’s just the result of life not being fair. Women are more likely to stay home with the kids, putting them in the position of having to find “new” employment after a divorce, whereas the man just trucks down the road at his current job. Moreover, women are more likely to have custody of the kids more of the time, which means that they have their hands full more often than the men. The men can often throw themselves into their careers, having been freed of the responsibilities of family life. In contrast, women have to keep the home life going, which takes time away from their careers. I don’t know how single moms do it. It’s too much for one person.
I agree. It’s not discrimination. Every person “chooses” their path. Whether they realize it or not. I believe that women and men can both be strong and motivated, whether or not they have children.. or animals! I am a single mom and have been for 9 years. I have an 11 year old and get very little child support. I don’t depend on it either. I don’t believe in Alimony since it’s only ordered for people to pay because the other person has adapted to a certain lifestyle. In my eyes, you get divorced and you change your lifestyle and your life entirely! When I had my son, I went back to work within 6 months. His dad worked 8-5, I worked 3-11. If women or men are determined to make things work, they find a way to do it. I own my home, by myself…. and don’t feel that anyone is discriminated on. It is up to each and every person to go get what they want…. make it work.. be aggressive and strong.
I think that it is admirable when people overcome disadvantages of race, gender, whatever and Lesley you have a right to take pride in that. But the fact is that men benefit from having a wife at home too — who’s there when the kids are sick (so he doesn’t have to leave work), who deals with the repair guys, who keeps the house clean, the fridge full, the errands run — it makes his life easier too, so why shouldn’t an at-home spouse’s contributions be worth something?
Additionally, for many families it is more economical to have one parent at home with the kids — daycare can be extremely expensive and many jobs don’t pay that well.Did you know that one in six people in this country works for Wal-Mart? And many in service industries have crummy benefits. I know — I worked two jobs (60 hours a week total) putting myself through college and I knew I was just one illness away from ending up in the street. And, like it or not, women make up a large portion of the people with those crummy jobs — that’s not a “lifestyle choice,” it’s survival. Yeah, I know ladies who lunch, play tennis, get their nails done and have housekeepers — but they’re in the minority. Cut the rest of them a break please