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LI minorities face mortgage hurdles even when incomes are similar to whites': Study

Gustavo F. Velasquez, assistant secretary for Fair Housing

Gustavo F. Velasquez, assistant secretary for Fair Housing and Equal Opportunity for the U.S. Department of Housing and Urban Development, speaks on the difficulties minorities have in buying homes on Dec. 10, 2014, during a Hofstra University conference. Credit: Barry Sloan

Long Island home buyers who are African-American or Latino are more likely than whites to be denied mortgages or get offered high-priced loans, even when incomes are similar, new research presented at a Hofstra University conference Wednesday shows.

In 2012, the most recent period examined in the report, African-Americans were denied home loans 1.55 times more often than whites, and Latinos were denied 1.3 times more often than whites. The research adjusted for income, loan amounts and certain other financial data, according to a report by Hofstra's National Center for Suburban Studies and Bohemia-based Long Island Housing Services.

In addition, minority borrowers were more likely to get higher-priced loans that are insured by the Federal Housing Administration, the report found.

It is "highly troubling" that such racial disparities exist even among borrowers with comparable incomes and loan amounts, professor Christopher Niedt, an author of the report, said at the conference.

However, he noted that the federal statistics the researchers relied on do not include applicants' credit scores, down payments and certain other relevant information.

Across the country, African-American and Latino borrowers face higher denial rates than whites, Gustavo Velasquez, assistant secretary for fair housing and equal opportunity for the federal Department of Housing and Urban Development, said at the conference.

The nation's economy and housing market are recovering, but "not all borrowers are experiencing this recovery," Velasquez said.

Mortgage lenders are not discriminating on the basis of race or other characteristics, one industry executive said.

Lenders feed information about borrowers' income, assets, credit scores and down payments into computer programs to determine whether to make loans and what interest rates to charge, said Bob Moulton, president of Americana Mortgage Group in Manhasset, who did not attend the conference.

The computer "does not ask age, gender, creed or nationality," Moulton said.

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