The data also show that 27% of Black borrowers who began an application with Wells Fargo in 2020 withdrew it. JPMorgan, Bank of America and Rocket Mortgage, formerly known as Quicken Loans, all approved Black borrowers in 2020 at the highest rate since 2010. The bank’s 47% approval rate was its second lowest during the past decade. Rocket Mortgage LLC, which received 1 million refinancing applications in 2020, more than any other lender, had the smallest gap: It approved 79% of Black applicants and 86% of White ones.Īmong major lenders, only Wells Fargo approved a smaller share of refinancing applications from Black homeowners in 2020 than a decade earlier. approved 66% of its Black applicants and 78% of White ones. bank by assets, accepted 81% of refinancing applications from Black homeowners in 2020 compared with 90% from White ones. But it’s a door that barely opened for Black Americans, who make up 9% of all homeowners and locked in just $198 million a year, less than 4% of the savings.

It’s one that allowed White homeowners to save an estimated $3.8 billion annually by refinancing their mortgages in 2020, according to researchers at the central bank. homeowners refinance almost $5 trillion in mortgages over the past two years, the most since the early 2000s. If, as expected, the Fed’s policy committee moves to hike interest rates at its March meeting, it will begin closing the door on a remarkable wealth event that has seen U.S. While Black applicants had lower approval rates than White ones at all major lenders, the data show, Wells Fargo had the biggest disparity and was alone in rejecting more Black homeowners than it accepted. Nationwide, only 47% of Black homeowners who completed a refinance application with Wells Fargo in 2020 were approved, compared with 72% of White homeowners, according to a Bloomberg News analysis of federal mortgage data. Source: Bloomberg analysis of Home Mortgage Disclosure Act data for 8 million completed applications to refinance conventional loans in 2020. “They didn’t want to move forward for whatever reason.” Disparity by Lender “They kept moving the needle,” Ricard says. Within weeks, Wells Fargo had denied his application. Soon after, Ricard was told he would have to pay a higher 4.5% rate, even though the Federal Reserve had slashed rates to historic lows. By May, she was writing to say the underwriter had more questions. Ricard’s house-an investment property that was his home before he moved to another Atlanta suburb in 2017-is in a predominantly Black neighborhood, and in April, the loan officer emailed to say that “perhaps the area is not eligible” for a rapid valuation. It didn’t take long for problems to appear. The loan officer at the bank even told him he was probably eligible for a fast-track appraisal.

engineer is married to a doctor and has a credit score north of 800, putting him in America’s credit elite. on Valentine’s Day in 2020 to refinance his mortgage on a four-bedroom brick colonial in a leafy suburb of Atlanta, he had every reason to expect an easy ride. When Mauise Ricard III paid a $560.43 application fee to Wells Fargo & Co.

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