'On the Take': The Black Box of Credit Scoring and Mortgage Discrimination

  title={'On the Take': The Black Box of Credit Scoring and Mortgage Discrimination},
  author={Cassandra Jones Havard},
  journal={University of Baltimore School of Law Legal Studies Research Paper Series},
  • Cassandra Jones Havard
  • Published 2011
  • Economics
  • University of Baltimore School of Law Legal Studies Research Paper Series
Subprime credit, a relatively new method of risk-based pricing, has been hailed as a way to open up markets and provide access to credit to those who would otherwise be excluded. Evidence suggests that subprime mortgage segmentation increases rather than reduces exclusionary practices in lending. Furthermore, what is unclear is how lenders determine who qualifies as a subprime borrower. This concern became manifested when studies demonstrated that minority borrowers, regardless of… 
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finding that the approval rates of African-American applicants correlate with the lender's percentage of African-American employees); see also Ross & Yinger, supra note 216
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See Ross & Yinger, supra note 215
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    Similarly, researchers also presume that any deviations from assigned weights are random