Bias
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And of course, even blacks who were eligible for standard mortgages were steered into expensive subprime mortgages:
Blacks are about twice as likely as whites to wind up in the more onerous and costly form of consumer bankruptcy as they try to dig out from their debts, a new study has found.
The disparity persisted even when the researchers adjusted for income, homeownership, assets and education. The evidence suggested that lawyers were disproportionately steering blacks into a process that was not as good for them financially, in part because of biases, whether conscious or unconscious.
The vast majority of debtors file under Chapter 7 of the bankruptcy code, which typically allows them to erase most debts in a matter of months. It tends to have a higher success rate and is less expensive than the alternative, Chapter 13, which requires debtors to dedicate their disposable income to paying back their debts for several years.
10:55 am
And, amazingly, new study finds blacks, compared to similaryly situated, econ situation whites, are steered into the most onerous form of bankruptcy — once those loans lead to the financial ruin.
Gee! How…intersting.
LINK to NYTimes article.