A former Chase banker spoke with The New York Times’ Nick Kristof about how Chase pushed subprime loans to minorities for big commissions. The Young Turks host Cenk Uygur breaks it down.
From Kristof’s article:
One memory particularly troubles [James] Theckston. He says that some account executives earned a commission seven times higher from subprime loans, rather than prime mortgages. So they looked for less savvy borrowers — those with less education, without previous mortgage experience, or without fluent English — and nudged them toward subprime loans.
These less savvy borrowers were disproportionately blacks and Latinos, he said, and they ended up paying a higher rate so that they were more likely to lose their homes. Senior executives seemed aware of this racial mismatch, he recalled, and frantically tried to cover it up.
Just how disproportionately? The people receiving these bad loads were 16% white, 33% Latino, and 50% Black. According to Think Progress:
These disparities help explain why, according to a new report from the Center on Responsible Lending, Latinos and blacks are twice as likely to have been impacted by the housing crisis as whites. In fact, “approximately one quarter of all Latino and African-American borrowers have lost their home to foreclosure or are seriously delinquent, compared to just under 12 percent for white borrowers.”
According to the Republicans and weak Democrats, we need to deregulate the banks anyway because these are the “professionals” Alan Greenspan referred to that are so brilliant, only they can trick minorities into taking bad loans so they can make money and we need to let them so they can get the economy back up and running again!
These people have no morals. Yeah, we need to deregulate an industry where its employees are throwing minorities out onto the street so they can make a quick buck.
(via so-treu)
