Mortgage lender accused of underserving Black homebuyers in Philly
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KeyBank, one of the largest mortgage lenders in the U.S., is accused of underserving Black borrowers in the Philadelphia region.
- That's according to a new report from the National Community Reinvestment Coalition (NCRC), a nonprofit advocating for the end of discrimination in housing, lending and business.
Why it matters: Philadelphia is still reckoning with a long history of discriminatory policies that made it more difficult for Black applicants to access mortgages, compared to their white counterparts.
- A report last year found that aspiring Black homebuyers in Philadelphia get denied mortgage loans more frequently than white applicants.
- Meanwhile, Philly's Black homeownership rate has been declining over the last three decades, per the Federal Reserve Bank of Philadelphia.
Driving the news: The report, released this month, found that Ohio-based KeyBank approved a mere 2.2% of its more than 1,220 mortgage loans in the Philadelphia region last year to Black borrowers — the lowest rate among top lenders. Nearly 40% of Philadelphians are Black.
- Other top banks in the area reported 8.2% of their mortgage loans went to Black homebuyers in 2021, according to NCRC's analysis.
- Philadelphia saw a "substantial decline" in KeyBank loans to Black homebuyers between 2018 and last year, the nonprofit wrote.
The other side: KeyBank said in a statement that it "strongly disagrees" with the NCRC's characterization of its lending activities and community benefits plan.
How it works: NCRC analyzed federal data from the Consumer Finance Protection Bureau between 2018-2021.
- Most of the group's analysis was limited to loans for 1-4 unit owner-occupied, site built homes.
Zoom out: Nationwide, KeyBank gave the lowest percentage of mortgages to Black borrowers among the 50 largest lenders in 2021, the report found.
- KeyBank was more likely to approve low-income white applicants for mortgages than high-income Black borrowers, according to the analysis.
What they're saying: KeyBank said in a statement that it increased loans to Black borrowers nationwide by 24% between 2018 and 2021, and more than doubled its lending to all minority groups during that period.
- "KeyBank does not discriminate and does not lend based on race," the bank said.
- "Any decision to deny an applicant is based solely on the financial information and data associated with the applicant," the bank added.
A company spokesperson declined Axios' request for comment.