The legacy of the home owners’ loan corporation

Crossney, Kristen B.; Bartelt, David W.

doi:10.1080/10511482.2005.9521555

Cited by 58 publications

(29 citation statements)

References 14 publications

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“…Some context is important to better understand HOLC's residential security maps and its practices from 1934 to 1951. While the HOLC created uniform guidelines for neighborhood appraisal, because appraisals were produced in direct consultation with local municipal officials, loan officers, appraisers, and realtors, evidence suggests some variation in the grading across cities (24). Still, these agents were familiar with their city's specific patterns of residential segregation.…”

Section: Introductionmentioning

confidence: 99%

Residential housing segregation and urban tree canopy in 37 US Cities

Locke

Hall

Grove

et al. 2020

Preprint

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Redlining was a racially discriminatory housing policy established by the federal Home Owners’ Loan Corporation (HOLC) during the 1930s. For decades, redlining limited access to homeownership and wealth creation among racial minorities, contributing to a host of adverse social outcomes, including high unemployment, poverty, and residential vacancy, that persist today. While the multigenerational socioeconomic impacts of redlining are increasingly understood, the impacts on urban environments and ecosystems remains unclear. To begin to address this gap, we investigated how the HOLC policy administered 80 years ago may relate to present-day tree canopy at the neighborhood level. Urban trees provide many ecosystem services, mitigate the urban heat island effect, and may improve quality of life in cities. In our prior research in Baltimore, MD, we discovered that redlining policy influenced the location and allocation of trees and parks. Our analysis of 37 metropolitan areas here shows that areas formerly graded D, which were mostly inhabited by racial and ethnic minorities, have on average ~23% tree canopy cover today. Areas formerly graded A, characterized by U.S.-born white populations living in newer housing stock, had nearly twice as much tree canopy (~43%). Results are consistent across small and large metropolitan regions. The ranking system used by Home Owners’ Loan Corporation to assess loan risk in the 1930s parallels the rank order of average percent tree canopy cover today.

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Section: Introductionmentioning

confidence: 99%

Residential housing segregation and urban tree canopy in 37 US Cities

Locke

Hall

Grove

et al. 2020

Preprint

View full text Add to dashboard Cite

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“…Sizable discontinuities in homeownership, median house value, and median years of school completed still exist at the HOLC boundary, with larger differences moving away. 23 The results are robust to limiting the sample to the 1930-2010 panel of 19 cities. 24 Household income unfortunately is not available from the NHGIS 1940 census data.…”

Section: Identification Challengesmentioning

confidence: 90%

“…Using 1940 rather than 1930 as my baseline allows me to expand expand my sample to more cities, which improves power and reliability. 23 Additionally, 1940 tracts a better align neighborhoods with HOLC boundaries, which minimizes within-city measurement error.…”

Section: Identification Challengesmentioning

confidence: 99%

Persistence of Prejudice: Estimating the Long Term Effects of Redlining

Krimmel¹

2018

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As part of a New Deal initiative to minimize home foreclosure, federal government officials and local real estate professionals graded each neighborhood in America's largest cities on its perceived credit risk. Using recently digitized maps that precisely show neighborhoods marked with red ink (highest risk) or yellow ink (slightly lower risk), I document that surveyors disproportionately assigned the most restrictive credit rating to neighborhoods with black residents. Nearly 90 percent of African Americans in 1940 lived in a census tract marked for credit redlining. Comparing credit-restricted "redlined" census tracts to adjacent "yellow-lined" tracts, I estimate the long-run effects of redlining on housing and neighborhood outcomes. Between 1940 and 1970, redlining was associated with large differential declines in housing supply and population density; homeownership rates and racial composition did not change differentially from their 1940 baseline though. Once discriminatory lending was outlawed during the mid-1970s, there was moderate convergence in homeownership rates and racial composition. However, housing supply and population density remain persistently lower in formerly credit-restricted census tracts relative to their credit-favored neighbors.

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“…On that occasion it was the purchase of troubled mortgages from lenders by the HOLC that was pivotal to state-orchestrated forbearance (Crossney and Bartelt 2006). But, with policymakers conscious of so-called 'moral hazard' and of providing assistance to lenders that they deem to be guilty of predatory practices, Federal support for forbearance in the sub-prime crisis has taken a form that is somewhat different to the operations of HOLC during the New Deal.…”

Section: Forbearance Programmes and Campaignsmentioning

confidence: 99%

Debt, Discipline, and Government: Foreclosure and Forbearance in the Subprime Mortgage Crisis

Langley

2009

Environ Plan A

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According to the Mortgage Bankers Association's (MBA's) National Delinquency Survey of June 2008, and based on their quarterly monitoring of a sample of 44 million mortgage loans,``about 1 in 11 mortgageholders face loan problems'' in the United States of America (Bajaj and Grynbaum, 2008). (1) Although the majority of these struggling mortgagors have missed a monthly repayment and are therefore categorised as`delinquent' by lenders, a sizeable number are said to be`in default' as their delinquency stretches over ninety days or more. Most disturbing, however, are the large and increasing number of mortgagors who, having passed through default, are being punished through`foreclosure'. Foreclosure is the legal process through which lenders and loan servicers exercise a right to sell, or to repossess ownership of, the property which has been pledged as security for a mortgage. The June 2008 levels of mortgage nonpayment are the highest since the MBA first undertook their survey in 1979, and represent a sharp turnaround from 2006 when delinquency, default, and foreclosure were all at their lowest recorded levels.Beneath the aggregate figures for delinquency, default, and foreclosure, the MBA's survey includes measures by loan type (eg prime, subprime), product type (eg fixed rate, adjustable rate), and state. As might be expected, these measures show that rates of delinquency, default, and especially foreclosure are much higher in the`subprime' sector of the market which concentrates on`high-risk' borrowers with low, irregular, or unverifiable incomes (such as workers on temporary employment contracts or the

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The legacy of the home owners’ loan corporation

Cited by 58 publications

References 14 publications

Residential housing segregation and urban tree canopy in 37 US Cities

Residential housing segregation and urban tree canopy in 37 US Cities

Persistence of Prejudice: Estimating the Long Term Effects of Redlining

Debt, Discipline, and Government: Foreclosure and Forbearance in the Subprime Mortgage Crisis

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