Harvard law professor and Congressional Oversight Panel member, Elizabeth Warren stated during an interview on Roland Martin’s Washington Watch that sub-prime loans has created a potential social upheaval in communities of color.
The high-cost loans by Big Bank Lenders such as Bank of America, Citibank, Indymac/OneWest, JP Morgan Chase, US Bank, and Wells Fargo, and their affiliates concentrated in neighborhoods of color. These lenders made 70% of all of their high-cost loans in neighborhoods predominantly of color. They forced the highcost loans on unsuspecting people who qualified for prime loans.
The high cost sub-prime loans, set conditions that allowed for a high concentration of foreclosures in communities of color.
Because people of color accumulate wealth through home ownership, 50% of wealth in these neighborhoods have been taken away.
Further, when it came time for the recovery that was supposed to take place, communities of color got shut out again because banks refused to cooperate to modify loans or restructure mortgages to help families stay in their homes.
Take a look at the clip above to see the interview.
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