Homeownership is regarded as core to the American dream. For most homeowning households, their home is their most valuable asset and provides families the ability to pass on generational wealth. But many communities face barriers and inequities in access to mortgage credit. Special purpose credit programs (SPCPs) are authorized by the Equal Credit Opportunity Act to improve equal access to credit.

This report provides compelling evidence for the need for SPCPs, consistent with Consumer Financial Protection Bureau guidance regarding the need for a broad analysis as part of the required written plan. Using data analyzed by the Urban Institute, the report provides comprehensive documentation of disparities in access to mortgage credit between households of color and white households, considering gaps along three dimensions of credit access (i.e., credit, collateral, and capacity) and their historical and societal causes. These trends are reflected nationally and in varying degrees at the market level.

Mortgage lenders and policymakers are encouraged to use this report as a resource to devise strategies aimed at extending credit to potential homebuyers who would otherwise be denied it or receive it on less favorable terms. By addressing these disparities, we can foster a more equitable lending environment and ensure that homeownership opportunities are accessible to all.