‘Redlining never really went away’: Black Rhode Island residents still face racism when buying a home
Within three months, Garlington found the ideal spot: a three-bedroom, two-bathroom home in the Wanskuck neighborhood of Providence.
But the process to complete the house, which should have taken about 45 days, took more than nine months.
“It got to the point where I told my realtor that I never wanted to look for another home ever again,” Garlington said. The biggest hurdle was having to repeatedly prove to the underwriter how much money she was making, even though she had documentation showing she could afford the mortgage payments on her $70,000-a-year salary.
A 2019 loan from a local university caused another snag: A credit report showed she still owed $3,900. But she never attended the course and says she never received the money from the loan.
“That should never have been on my credit report,” Garlington said. A letter to the insurer explaining the situation should have sufficed, she said: “But they [the underwriter] forced to pay, otherwise I would miss the opportunity to get the house.”
She wonders if white homebuyers face similar problems.
“This is what racial discrimination looks like when you’re trying to buy a house in Rhode Island,” she said.
Differences in home ownership between blacks and people of all races persist. More white, Asian and Hispanic Americans have owned their own homes in the United States than black Americans, according to a newly released report by Brown University researchers titled “The State of Black Rhode Island Homeownership.”
And inequality is particularly bad in Rhode Island. The total home ownership rate in the Ocean State is about the same as the US as a whole: 64 percent of all Americans owned a home in 2019, and 62 percent of all Rhode Island residents owned a home.
The discrepancy becomes clear when the data is broken down by race. In the USA, 73 percent of white Americans owned a home in 2019, compared to 42 percent of black Americans. But in Rhode Island, 62 percent of all residents owned a home in 2019, compared to just 34 percent of Black Rhode Island residents dr Akilah Dulina professor of behavioral and social sciences and lead researcher on the report who was paid for by the United Way of Rhode Island.
In 2019, there were 25,024 black households in Rhode Island. Of those households, 8,571 were homeowners and 16,453 were renters, Dulin said.
“My desire to look to Black Rhode Island began when I was contemplating moving here myself. When I started researching what it was like to be black in Rhode Island, I realized it was an undesirable place,” said Dulin, who moved to Rhode Island from Alabama in 2012.
The Rhode Island housing crisis, particularly among black residents, is reaching a tipping point. Soaring rents are driving hundreds of Rhode Islanders out of their homes — more than 300 people slept outside or in their cars every night in February alone, according to the Rhode Island Coalition to End Homelessness. The real estate market is so hot that fewer first-time buyers can keep up. The median price of a single-family home in Rhode Island is $370,000 and the median price of an apartment building is $399,900, according to the Rhode Island Association of Realtors.
Proponents say home ownership, which could build generational wealth, is the long-term answer to ending the housing crisis, but federal, state, and local policies have left black Americans with limited homeownership opportunities. Historical barriers remain, according to Dulin.
“Education is part of it. And it’s important. But education without resources and without removing systemic barriers will not have the kind of tangible impact that we need and that will be sustainable,” Dulin said.
In the report, she recommends making it easier for black homeowners to access small mortgage supports (about $10,000 to $70,000) for single-family homes. She said a mortgage assistance program, coupled with a homebuyer education program, could reduce the black-white divide by at least 12 percent.
These programs for prospective Black homeowners “are a way to bridge the gap and help in our current housing crisis.”
The historical barriers to homeownership for Black Rhode Island residents trace their roots to the 1930s, when red lines were drawn on maps to indicate “dangerous neighborhoods” in Providence, the researchers found. Lenders were less likely to approve mortgages or offer cheap interest rates in these predominantly black areas.
Advocates pushed for fair housing practices, and after 30 years, the Rhode Island Fair Housing Practices Act was passed in April 1965, allowing people to claim housing claims based on discrimination.
But it didn’t stop redlining.
“Black people, despite their creditworthiness, are more likely to be denied home loans, offered subprime loans or loans with higher interest rates,” the report said. This, in turn, can adversely affect a person’s creditworthiness.
Kobi Dennis, chief operating officer at YMCA of Greater Providence, said the most amazing part of the data for him shows black people have lower credit scores compared to their white counterparts. “That is proven in this report. There is no more debate,” he said. “So what are we going to do about it?”
In 2014, the city of Providence sued Santander Bank for redlining, alleging the bank had increased its mortgage lending in predominantly white neighborhoods by 25 percent and reduced its lending to blacks by 63 percent. While the lawsuit was dropped, the bank paid $1.3 million to the Providence Community Library. AS220 (a downtown arts and culture organization) and the Rhode Island Local Initiatives Support Corp., a new grant program that helped pay mortgage repayments and closing costs for “low- and middle-income residents of Providence.”
“None of this money specifically helped promote black home ownership, which is why they were sued in the first place,” Dennis said.
Five years later, the Rhode Island Commission for Human Rights received 330 reports of violations of the Fair Housing Practices Act, and nearly a quarter of the allegations of discrimination were based on race.
Dulin explained that black Americans applying for mortgages were 50 to 120 percent more likely to be denied loans than white mortgage applicants, even with the same application profile as whites. She said blacks tend to be shown fewer homes by real estate agents, are directed to minority neighborhoods, and receive less help in their search.
In 2020, 1,288 black and 16,037 white Rhode Island residents submitted mortgage loan applications for home purchases. But 10 percent of black applicants were turned down, while 6 percent of white applicants were turned down.
“This goes so far beyond financial education,” Dulin said. “It’s like redlining never really went away.”
The pandemic, she said, has only exacerbated the problem. Dulin found that nearly 20 percent of black homeowners reported being in arrears on mortgage payments, and few of them were aware of the mortgage forbearance options made available during the pandemic.
Daynah Williams is Director of Homeownership Services and Asset Building at Neighbor Works Blackstone Valley in Woonsocket, which offers homebuyers free courses and personalized budget reviews with financial advisors.
“There are certain people in the community who aren’t involved in anything related to education,” she told the Globe. “They’re told, ‘Buy a house. Get your credit together.’ That’s all great, but how do you keep it up? We are that sounding board.”
However, as a black woman, Williams said being able to buy a home isn’t just about financial literacy. “In other jobs, I’ve definitely seen that my own earning power doesn’t match that of my white peers, for the same job and for the same skills.”
“When you’re someone of color and you finally get to that point after living in survival mode, it’s emotional,” she said.
“It often happens that many of us people are not allowed to enter certain areas. We’re being guided and don’t even realize it’s happening,” she said. “Nineteenth-century practices and redlining from the 1930s are still having an impact in this state today.”
Back in the Wanskuck area of Providence, Garlington closed her home in mid-February. But she now has to hire a lawyer and try to get back the money she paid for a loan she never got for a class she never took, just to get approval for the house she’s having bought her daughter in the first place.
She quipped, “In what world is that fair?”