Woah, Navy Federal is hella racist

[Anonymous]

Anonymous wrote:

Anonymous wrote:Yep:
https://www.investopedia.com/average-credit-scores-by-race-5214521

Explains everything except Asian. Asians with a military connection have lower than average credit scores?

CNN used HMDA data, which does not provide credit scores. So they can’t control for that.

HOWEVER. CNN writes “…most of the Navy Federal applications that were denied are listed as being rejected for reasons other than “credit history.””

So they were not being rejected due to their credit history, which would flow thru to credit scoring.

And yes, Asians with military connection are likely more working class, shorter family history in the U.S., etc than NavyFed members who are white.

It would be interesting to know if NavyFed members who are white are actually military. I bet majority are family of military who inherited rights to NavyFed account and pretty far removed from military service. Whereas most black/Asian/Hispanic NavyFed members are actually direct military (either themselves or a parent). White NavyFed members are probably more likely to be college educated, white collar, and probably two-generations removed from military service.

that was clever of CNN but I’m not sure “credit history” is the same thing as “credit score.”

[Anonymous]

Anonymous wrote:One thing to note:
CNN’s analysis is for conventional mortgages. These are mortgages with standardized terms and the lowest interest rates.

They may have been rejecting them for conventional products in order to steer them to higher priced non-conventional products like ARMs.

why wouldn’t they get VA loans?

[Anonymous]

Anonymous wrote:

Anonymous wrote:lol to people who are shocked there is systemic racism in housing.

Did you just wake from a coma?

The military as an institution is a lot blacker than the public at-large. You’d think NavyFed would have better systems in place to prevent this sort of discrimination.

I expect podunk rural ag bank in Nebraska to be pretty racist. But not NavyFed. They need to clean house.

You are still showing your ignorance in the subject.

You think places like Chevy chase and Bethesda are predominantly white by accident. This is not just a middle America racism issue.

Also the military is way racist and sexist. Not sure why you would think it’s not.

Again did you just wake up from a coma?

[Anonymous]

I work with a credit union. Not NFCU. In the DMV I say Black makes up a huge amount of workers. I say the credit union I work with 60 percent of mortgage team is black.

[Anonymous]

Anonymous wrote:How is a conclusion that only includes one single data point valid? What about down payments--yes, privileged white people are much more likely to have down payments given to them--debt, and most of all, credit score? Such a flawed and biased story.

read the whole story. CNN controlled for all the data points available in puboic HMDA including debt to income, downpayment, etc.

[Anonymous]

lol racists trying to explain this away.

SMFH

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How is a conclusion that only includes one single data point valid? What about down payments--yes, privileged white people are much more likely to have down payments given to them--debt, and most of all, credit score? Such a flawed and biased story.

Well the story focused on a black man who was rejected for a loan with 700+ FICO, 20% down payment, $100K income, and SFH owner occupied use. That’s a slam dunk underwriting approval.

It’s not a slam dunk if debt to income is high, which they mentioned, and you left out…

A White guy with a 700 score, 20% down, and a $100k job can’t qualify for a $800k house, so there are more factors

I can’t get worked up about this until I know what price range the homes and then exactly how many mortgages were applied for in the group with income $140k and over to get a more clear picture.

is the $140k salary a one off and previous years were lower - so they average the salary over a few years?

were the applicants approved on a subsequent application for a home at a lower price point?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Yep:
https://www.investopedia.com/average-credit-scores-by-race-5214521

Explains everything except Asian. Asians with a military connection have lower than average credit scores?

CNN used HMDA data, which does not provide credit scores. So they can’t control for that.

HOWEVER. CNN writes “…most of the Navy Federal applications that were denied are listed as being rejected for reasons other than “credit history.””

So they were not being rejected due to their credit history, which would flow thru to credit scoring.

And yes, Asians with military connection are likely more working class, shorter family history in the U.S., etc than NavyFed members who are white.

It would be interesting to know if NavyFed members who are white are actually military. I bet majority are family of military who inherited rights to NavyFed account and pretty far removed from military service. Whereas most black/Asian/Hispanic NavyFed members are actually direct military (either themselves or a parent). White NavyFed members are probably more likely to be college educated, white collar, and probably two-generations removed from military service.

The fact that CNN doesn’t mention what those “reasons other than credit history” are is a curious and in my mind quite telling omission. If those reasons supported the implied narrative of racial discrimination, I’m sure they would have been mentioned.

“Other than credit history” is the field that NavyFed selected when filing their HMDA disclosures. If they rejected a borrower based on credit history, they would’ve selected that. So there’s nothing else for CNN to report because there’s no other data available to CNN for them to drill into. NavyFed selected “other than credit history.”

That’s interesting — so that’s a check-the-box field, not a selection from a list of reasons?

DP. There is a list of 9 reasons and if it’s “other,” they are supposed to fill in a text field to explain why. However the text fields are not public so CNN wouldn’t be able to see them.

You can read a description of the data fields in detail here! https://files.consumerfinance.gov/f/documents/cfpb_reportable-hmda-data_regulatory-and-reporting-overview-reference-chart-2019.pdf

[Anonymous]

Anonymous wrote:lol racists trying to explain this away.

SMFH

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How is a conclusion that only includes one single data point valid? What about down payments--yes, privileged white people are much more likely to have down payments given to them--debt, and most of all, credit score? Such a flawed and biased story.

Well the story focused on a black man who was rejected for a loan with 700+ FICO, 20% down payment, $100K income, and SFH owner occupied use. That’s a slam dunk underwriting approval.

It’s not a slam dunk if debt to income is high, which they mentioned, and you left out…

A White guy with a 700 score, 20% down, and a $100k job can’t qualify for a $800k house, so there are more factors

I can’t get worked up about this until I know what price range the homes and then exactly how many mortgages were applied for in the group with income $140k and over to get a more clear picture.

is the $140k salary a one off and previous years were lower - so they average the salary over a few years?

were the applicants approved on a subsequent application for a home at a lower price point?

I mean, I think all of us who have ever been involved in fair lending (and I suspect that may be more than a few DCUMs) really want to know how this happened. Nobody can conclude overt discrimination yet, and of course CNNs analysis could be totally wrong. But in any event, you are wrong to think you could figure it out just by looking at one $140k white applicant. That’s the whole thing about statistics ….

[Anonymous]

Anonymous wrote:

Anonymous wrote:lol racists trying to explain this away.

SMFH

Cool now show how that credit score differential justifies the differential in approval rates based on risk to the lender.

WE’LL WAIT lol.

[Anonymous]

Anonymous wrote:

Anonymous wrote:How is a conclusion that only includes one single data point valid? What about down payments--yes, privileged white people are much more likely to have down payments given to them--debt, and most of all, credit score? Such a flawed and biased story.

Well the story focused on a black man who was rejected for a loan with 700+ FICO, 20% down payment, $100K income, and SFH owner occupied use. That’s a slam dunk underwriting approval.

And how much was he asking for?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:How is a conclusion that only includes one single data point valid? What about down payments--yes, privileged white people are much more likely to have down payments given to them--debt, and most of all, credit score? Such a flawed and biased story.

Well the story focused on a black man who was rejected for a loan with 700+ FICO, 20% down payment, $100K income, and SFH owner occupied use. That’s a slam dunk underwriting approval.

And how much was he asking for?

If you actually bother to read the article you'd know.

He was quickly approved by another lender and bought the house. The real question is why Navy Federal's disparity in approval rates is so much larger than every other bank's. Differences in black and white average credit score would lead to a disparity in mortgage approval rates, of course. But it's doubtful this general difference in credit scores by race would explain why Navy Federal's disparities in mortgage approvals is so much larger than other mortgage lenders.

[Anonymous]

The man in the story bought a house that was listed for $415K with “over 20% downpayment” and an income greater than $100K.

I found the house he bought using public record search. It matches the photo in the CNN article. He can clearly afford this house.

Further, the man stated that he had no major debts and was already preapproved by NavyFed. Preapprovals always require a soft proof of income (either W2s or previous taxes) and credit check (to figure out DTI), so the bank can figure out how much to they can put on the preapproval letter. Sure, it’s not a full underwriting but they have a good ballpark of what you can afford.

This guy in 2021 could easily afford a $325K mortgage.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:lol racists trying to explain this away.

SMFH

Cool now show how that credit score differential justifies the differential in approval rates based on risk to the lender.

WE’LL WAIT lol.

Cool, we don't have to point out the obvious risk to you.

WE WON'T WAIT lol.