"Life is all right in America", "If you're all white in America" --- From the song "America", a well-known song from the musical West Side Story. The birth of Franklin Delano Roosevelt’s New Deal opened new opportunities to Americans who had suffered through the long Great Depression. One of the new opportunities afforded to Americans were the policies that made it possible for more Americans to own their own homes. However, there was an important qualification that needed to be in place to experience the benefits of these policies: you needed to be white and middle class. The exclusion of African Americans from these policies was perpetuated by the establishment of the Federal Housing Administration (FHA) and the Home Owners Loan Corporation (HOLC), who discriminated against African Americans by deeming African American neighborhoods unworthy of credit and denied African American families of federally backed loans and mortgages. African Americans soon gained the reputation of hurting the property values of any land they inhabited, resulting in a widespread housing segregation. As a result, although the unequal housing market is often thought of as a by-product of deep-rooted racism against African Americans, it was in fact due to federal policies and private practices that served to promote and encourage already existing racism. This promotion of racial inequality reinforced both the racist actions of individuals, but also allowed realtors to take advantage of African Americans who desperately to achieve the America...
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...ng to gain from participating in these agreements. The banks knew the loan would be detrimental in the long run, “banks and brokers targeted vulnerable longtime homeowners and lured them into needless and rapidly recurring mortgages they clearly couldn’t afford and from which never stood to gain.” Similarly, the contract sellers knew people buying on contract would never be able gain equity on the homes they sold to them, because with the impossibly high payments the seller would almost always get the property back.
Thomas J. Sugrue, Sweet Land of Liberty: The Forgotten Struggle for Civil Rights in the North (New York, 2008), p. 204.
Beryl Satter, Family Properties: Race, Real Estate, and the Exploitation of Black Urban America (New York, 2009), p. 40.
Kai Wright, “Mortgage Industry Bankrupts Black America,” The Nation, July 14, 2008.