Lenders' Tilt Cost Poor D.C. Neighborhoods $1B, Group Says

WASHINGTON - Low-income and minority communities in the nation's capital were deprived of $1 billion in mortgage lending during the past three years, according to a new study.

Community First Inc., a nonprofit community activists organization, said banks here make far more loans to predominately white communities. If financial institutions had made the same percentage of loans in low-income and minority borrowers in 1991-93, they would have had to boost lending by $1 billion.

"Those potential loans could have brought new wealth through homeownership to 10,000 families in D.C.," the group said in its 37-page study.

The group based its work on 15,000 loans worth $2.4 billion that banks reported in their 1993 Home Mortgage Disclosure Act data.

Dramatic differences in lending activity persist here, the group said. It found six out of 100 homeowners in predominately minority areas here either refinanced or received new mortgages, versus 19 of 100 in predominately white areas.

"With homeownership as a prime component of wealth for most D.C. families, it is imperative that the flow of credit be full and fair," the group wrote. "It is not yet so."