Committee on Housing and Real Estate

This virtual subject matter hearing will focus on presenting the issue of disparities in Equitable Mortgage Lending in Chicago with presentations from the Department of Housing, affordable housing advocates, neighborhood organizations and elected officials. No vote will be taken.

Watch the hearing along with me here: https://livestream.com/accounts/28669066

Chairman Osterman (48) calls the meeting/hearing to order. Roll call to establish quorum begins. Quorum reached. 12 members of the committee present.

The first public speaker was supposed to be George Blakemore. Not present. Cathy of the Chicago Urban League speaks in favor of homeownership for black and brown residents of the city. She states that homeownership is a big factor in the wealth gap that persists.

The next speaker says common access to loans is the key to ensuring the black & brown ownership of homes. Says the racial wealth gap is daunting to the city and wants the committee to find solutions to this issue.

Chairman Osterman cites the research done by WBEZ and City Bureau that investigated the lack of mortgage lending in black & brown communities. See that information here: https://interactive.wbez.org/2020/banking/disparity/

Marisa Novara, Commissioner of the Department of Housing begins her presentation. She says that lack of loans & low appraisals of the value of property in black & brown neighborhoods is a byproduct of systemic racism.

Novara says that race-neutral policy has not resulted in progress in addressing the widening racial wealth gap.

Banks and lenders who choose to participate in the hearing. Guaranteed Rate was the only lender that chose to join. https://t.co/2sY99IU5hR

Congressman Chuy García says that segregation continues to shape who owns homes in Chicago. Says that the housing crisis is not new in the district that he represents. Gentrification and redlining have plagued the ability of black and brown citizens to participate in the market.

Congressman Mike Quigley speaks about the ways the pandemic has exacerbated the issue of the racial wealth gap. Says he expects the Covid bill to be voted on later this evening in Congress to give resources back to those who have fallen on hard times.

Sarah Brune, Director of Public Policy NHS Chicago, and Anthony Simpkins, President & CEO of NHS Chicago begin their presentation on lending disparities in Chicago. https://t.co/dPWIJzW1JI

Map of lending and investment in Chicago. The map and data show the wide gap of mortgage loans in white and minority communities. https://t.co/OMJObDL2uo

Anthony Simpkins, President of NHS says that black and brown creditworthy borrowers are often denied loans and charged higher interest rates. And are also more likely to have their homes foreclosed. https://t.co/sbq6ukzYif

Anthony Simpkins says that in his family’s pursuit of homeownership there were certain banks and lenders they didn’t consider because of their history of not lending to black and brown people. Says these results were not an accident but intentional. https://t.co/7yV4RiB3Vl

Joe Bozeman III and his partner speak about the difficulties they had in securing loans to buy a home. Shifting rates and closing fees were a huge barrier to achieving their goal of homeownership. https://t.co/RgSGMtE6bk

Phleeca Suarau, a Lawndale resident speaks about her troubles with loans and refinancing. Says her credit was run three times despite paying her bills on time and having good credit. Says she was denied a loan from three banks without reason. https://t.co/5OvwwcezHu

Horacio Mendez, President of Woodstock Institute says that predatory lending practices have contributed to the discrimination against black and brown people attempting to buy homes. Says banks can do much more in solving this problem. https://t.co/RmqsRvJo77

Melissa Conyears-Ervin, City Treasurer of Chicago begins her testimony with a personal story of her attempt to purchase a home in North Lawndale. Says that even she had difficulty in securing a loan despite her master’s degree and credit history. https://t.co/dp03cvYPZh

Mike Frerichs, Illinois Treasurer says that he is invested in addressing redlining and systemic exclusion as barriers to homeownership. Says outdated and racist policy has sapped financial strength from the state. https://t.co/mdjwCaedWl

Horacio Mendez says that the federal government has the responsibility to uphold anti-discriminatory laws and financial institutions to come to the table and help address bad practices.

Ald. Michael Scott Jr. (24) says that North Lawndale is ground zero for redlining in Chicago. Wants banks and lenders to help reverse years of disinvestment.

Questions from committee members start with Ald. Matt Martin (47) stating that council members and government leaders should go further and demand that banks & lenders participate in righting the wrong of disinvestment.

Ald. Martin (47) remarks on the absence of banks and lenders in this hearing as problematic and wants them to provide resources and not just lip service to address this issue.

Ald. Daniel La Spata (1) asks NHS about the regulatory grading of banks like JP Morgan Chase who score high on CRA (Community Reinvestment Act) but perform terribly in lending to black and brown people.

President Mendez chimed in and says that the federal government needs to better the rating system under the CRA and stop comparing banks lending practices to other banks. Who sucks least is not the proper benchmark for compliance.

Ald. Sigcho-Lopez (25) asks about the oversight available of the committee to get banks and lenders to lend to disinvested communities. Chairman Osterman says that much of that power belongs to the federal government.

Ald. Sophia King (4) begins her questioning by saying that banks should be held accountable for their actions since they benefited tremendously from the federal policy that began during the new deal. Lending money to immigrants so they can own homes but not to black and brown.

Ald. Waguespack (32) opens his questioning mentioning the fact that a majority of these banks & lenders who chose not to participate in today’s hearing contributed to the housing crisis of 2008.

Ald. Pat Dowell (3) wants special attention paid to the appraisal of land/property. Says appraisal companies have wreaked havoc on black & brown communities. Sarah Brune, NHS says that diversification of the appraisal industry is important to address this problem.

President Mendez says that race is the most important factor in appraisal discrepancies. Says that some homeowners he knows have hung up photos of white ppl in their homes and that resulted in higher appraisals of the property.

Anthony Simpkins breaks down how owning a home and using that equity can be used to create generational wealth. Some use that equity to pay for college for children, loans for small businesses, &, etc. Locking people out of that enterprise has impacted communities dramatically.

Chairman Osterman wants committee members to appreciate how inequitable mortgage lending is connected to a multitude of issues that plague our society. Motions meeting to adjourn. Motion seconded. Hearing ends.

Chicago City Council’s Committee on Housing and Real Estate hearing ends at 12:53 p.m. This ends my coverage for @CHIdocumenters more information through Amira Olingou’s notes at http://documenters.org