While recent headlines tout a soaring housing market, challenges remain for low-income people of color. Mortgage credit outside of the Federal Housing Administration (FHA) is scarce, and African-American homeownership rates, which hit a high of 50 percent in 2004, continue to fall and could drop as low as 40 percent soon.

The economic challenges facing Americans of color

Despite its challenges, the African-American community is resilient, and its enormous purchasing power ($1.75 trillion projected) should not be overlooked. However financial stagnation has become concentrated in many communities of color and is fueled by the nation’s persistent residential segregation. Indeed, America’s Latin community shares many of the economic challenges faced by African Americans. Together, these populations will constitute more than half of all new households over the coming decade.

Even as it declines for African-Americans, homeownership will continue to be the number one wealth-building tool for the typical American family for decades to come. Therefore it is imperative to re-imagine a national housing finance system that supports homeownership growth and expansion in ways that serve the needs of a diverse America. Furthermore, public policy must recognize the enormous damage inflicted on households and communities by its failures. Many potential borrowers today lost their limited wealth or good credit scores directly as a result of reckless and irresponsible mortgage products that ushered them into foreclosure.

Even as it declines for African-Americans, homeownership will continue to be the number one wealth-building tool for the typical American family for decades to come.

Creating opportunities

The National Urban League supports a system that ensures all credit-worthy borrowers can access affordable mortgage credit in ways that protect taxpayers. The organization values the preservation of an affordable housing mission with inclusive loan products and services and supports upholding fair housing laws and equal treatment for community banks, CDFIs and credit unions. The National Urban League recommends focusing comprehensively on the needs, aspirations and capabilities of borrowers as opposed to focusing primarily on the limitations and risk aversion of institutions.

The National Urban League’s historic mission is to promote healthy, resilient, and equitable communities. Strengthening the financial future of families of color and the communities where they reside through homeownership will continue to dominate the modern-day civil rights imperative.