After identifying seven likely areas of potential discrimination in the home buying process, participants formed task groups to study each area. The groups were expected to review and evaluate industry standards and practices, recommend methods and strategies for reducing discrimination, and develop educational resources for consumers, professionals, and industries.
INITIAL CONTACT WITH THE
- Task group members recommended that the term "conventional financing only" be omitted from Multiple
Listing Service information because it may discourage buyers who are planning to utilize VA, FHA, and
other nonconventional financing methods.
- The group agreed to urge the Ohio Real Estate Commission to adopt an additional article in its Canon of Ethics,
stating that licensees shall not market property in a manner that indicates a preference for "conventional
- The task group oversaw the development of a "Fairness in Lending" continuing education class for real
- As a result of the task groups suggestion, the Cuyahoga Plan of Ohio, a nonprofit organization that
promotes fair housing practices, has offered to facilitate future meetings between white and minority real
INITIAL CONTACT WITH THE
- The "initial contact with lender" is a critical area of potential discrimination. Because insensitive or inconsistent treatment by loan originators can significantly impact the loan application process, the task group
recommended the development of an industrywide training and certification program for lenders. Program
curricula will include case studies on discrimination, instruction on fair lending laws and community reinvestment, and multicultural awareness and sales training.
- Firms that participate in the secondary mortgage market purchase a large percentage of residential loans
from primary lenders. Since secondary-firm underwriting guidelines may differ from bank underwriting
policies, the task group recommended ongoing training in secondary-market underwriting guidelines for
primary lending institutions, underwriters, real estate agents, and community groups.
- The task group proposed that high schools implement academic curricula that educate students about the
home buying process, mortgage loan programs, and the importance of a good credit rating and job history.
- The task group proposed that lending institutions and professional appraisal associations coordinate the
development of a training and evaluation program for appraisers of urban residential properties.
- The group oversaw the publication of a reference directory of Community Development Corporations (CDCs)
and city planners.
- The task group recommended that insurers eliminate potentially discriminatory criteria from their underwriting
requirements, including minimum insurance amounts, age of home, and location of home. Group members
also proposed that insurance companies maintain uniform, consistent company practices regarding cancellation,
nonrenewal, and rejection of policies.
- The task group developed an "Insurance Rights and Obligations" educational pamphlet for consumers.
- The group recommended elimination of credit reports as an underwriting consideration.
- Private mortgage insurance is designed to protect lenders against foreclosure. Task group members developed
a brochure for consumers that explains the purposes of mortgage insurance and the consumers options to
cancel the coverage.
- The task group proposed the development of a mortgage-insurance continuing education course for real
- The group commissioned a consumer-oriented pamphlet that explains the function of the credit bureau and
the importance of maintaining a good credit history.
- The task group urged area public utilities to report credit information to credit repositories so that low- and
moderate-income individuals can demonstrate the regularity of their payments.
- The Greater Cleveland Residential Housing and Mortgage Credit ProjectFull text of essay
- Planning Committee
- Cleveland Project Sponsors
- Test Project: Appraising an Urban Home
- Task Group Accomplishments
- Task Group Members
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