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Explore the roots and timeline of redlining in the United States real estate market. Discover how this discriminatory practice emerged and its lasting impact on marginalized communities.

Redlining has left an indelible mark on the history of real estate in the United States. This discriminatory practice involved denying access to housing opportunities based on racial or ethnic backgrounds, primarily affecting African Americans and other minority groups. To fully comprehend the magnitude of redlining's impact, it is crucial to understand when and how it began. In this article, we will delve into the origins of redlining, its historical timeline, and its enduring consequences.

#1. The Emergence of Redlining in the Early 20th Century

During the early 20th century, the United States experienced a surge in urbanization, with cities rapidly expanding and transforming. Amid this growth, racial and ethnic divisions became increasingly prevalent. In response to these changes, the federal government sought to regulate and separate neighborhoods based on race, leading to the birth of redlining.

#2. The Role of the Home Owners' Loan Corporation (HOLC)

The Home Owners' Loan Corporation (HOLC), established in

Jun 9, 2017 — A loan given to people who are purchasing real estate is called a Get the answers you need, now!

What is redlining and the Fair Housing Act of 1968?

Redlining on a racial basis has been held by the courts to be an illegal practice. It is unlawful under the FHAct only when done on a prohibited basis. Redlining an area on the basis of such consider ations as the fact that the area lies on a fault line or a flood plain is not prohibited.

What was redlining in 1950?

Redlining was the practice of outlining areas with sizable Black populations in red ink on maps as a warning to mortgage lenders, effectively isolating Black people in areas that would suffer lower levels of investment than their white counterparts.

What did the Fair Housing Act of 1968 do?

The 1968 Act expanded on previous acts and prohibited discrimination concerning the sale, rental, and financing of housing based on race, religion, national origin, sex, (and as amended) handicap and family status. Title VIII of the Act is also known as the Fair Housing Act (of 1968).

Where did redlining originate?

The origins of the term come from government homeownership programs that were created as part of the 1930s-era New Deal. The programs offered government-insured mortgages for homeowners — a form of federal aid designed to stave off a massive wave of foreclosures in the wake of the Depression.

What did the Fair Housing Act of 1968 end?

Discrimination in Housing Based Upon Race or Color

One of the central objectives of the Fair Housing Act, when Congress enacted it in 1968, was to prohibit race discrimination in sales and rentals of housing. Nevertheless, more than 30 years later, race discrimination in housing continues to be a problem.

What is a purchase money first mortgage?

Primary tabs. Sometimes, a person buying real property gives the seller a mortgage on the property as part of the deal to buy the property. This is called a purchase money mortgage, because this type of mortgage usually replaces part or all of the cash that the buyer would otherwise pay the seller.

Frequently Asked Questions

What does purchase money first mean on the credit report?

Purchase Money First means that the proceeds of the loan are used to buy the property.

What is it called when you get a loan to buy a house?

This type of borrowing is called a first mortgage loan. There are also mortgage loans that can help out with down payment or closing costs, called junior loans.

What are the three main types of mortgages?

Types of mortgages
  • Conventional loan: Best for borrowers with good credit scores.
  • Jumbo loan: Best for borrowers with excellent credit looking to buy a more expensive home.
  • Government-backed loan: Best for borrowers who have lower credit scores and minimal cash for a down payment.

Can you buy a home with a DSCR loan?

Some of the property types you can use a DSCR loan for include: Single Family Residences (SFR), including single-family homes, condos, and townhomes. Multifamily properties (2-10 Units).


What is redlining and who does it affect?

Redlining refers to the practice of systematically denying various services (e.g., credit access) to residents of specific neighborhoods, often based on race/ethnicity and primarily within urban communities.

Who created redlining maps?


The maps were created by the HOLC as part of its City Survey Program in the late 1930s. The HOLC deployed examiners across the country to classify neighborhoods by their perceived level of lending risk.

Who should an agent immediately contact if a seller does not comply with anti discrimination laws?
The California Civil Rights Department (CRD) is responsible for enforcing state fair housing laws that make it illegal to discriminate against or harass someone because of a protected characteristic, such as their gender, race, national origin, sexual orientation, gender identity, or religion.

When did redlining in real estate begin

What is redlining in real estate?

The term refers to the presumed practice of mortgage lenders of drawing red lines around portions of a map to indicate areas or neighborhoods in which they do not want to make loans. Redlining on a racial basis has been held by the courts to be an illegal practice.

What is redlining in NY State?

HOW WAS REDLINING DONE? Neighborhoods that were deemed “hazardous” by the Home Owners' Loan Corporation (HOLC), an official governmental body, were shaded in red on maps, and banks were encouraged to avoid lending in those areas.

What does redlining in real estate mean?

The term refers to the presumed practice of mortgage lenders of drawing red lines around portions of a map to indicate areas or neighborhoods in which they do not want to make loans. Redlining on a racial basis has been held by the courts to be an illegal practice.

  • What is an example of redlining?
    • As an illustration of redlining, reporter Bill Dedman published a series of articles in the 1980s demonstrating that Atlanta banks would lend in lower-income white neighborhoods but would refuse to lend in middle-income or upper-income Black neighborhoods.

  • What is the concept of redlining?
    • Redlining is a term used for an illegal practice where people living in a certain area or neighborhood are not given the same access to loans and other credit services as people in other areas or neighborhoods on the basis of race, color, national origin, or some other prohibited reason, regardless of their ability to

  • How do you identify redlining?
    • In evaluating potential redlining risk, banks may seek to better understand their market area and its corresponding demographics, determine how loan applications are generated, and then assess lending data to identify any differences between geographies with different demographics.

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