CLEVELAND, OH – Some African Americans think Dan Gilbert is “cool” because he’s from Detroit, Michigan, owns an NBA team that Lebron James’ talent made money; and is seen in pictures with a lot of prominent black folk he gives money. What’s not “cool” about Gilbert is how he’s redlined Cleveland’s black neighborhoods out of his Quickens Loans lending equation like every other racist lender in the local housing loan marketplace.
Cleveland’s “Fair Housing Center for Rights & Research” released a report in July 2018 this town’s mainstream media ignored. The report co-authored by Michael Lepley and Lenore Mangiarelli was paid for with a HUD grant to examine how lenders are loaning money to prospective homebuyers in Cuyahoga County.
The report highlights the redlining lending practices of all the major mortgage backers. It reveal that African Americans who want to live in housing valued under $50,000 in predominantly black neighborhoods are not getting them from any of the redlining mortgage funders. It’s Gilbert’s ownership of the Cleveland Cavaliers and hands in the predominantly black city’s governmental purse strings that makes his lending practices noteworthy.
Lepley and Mangierelli’s report explained how “redlining” became a practice during and after the Depression of 1930 when Congerss created the Home Owner’s Loan Corporation and the Federal Housing Administration in 1933 and 1934. The “racial makeup” of neighborhoods were factored into the loan equation and “residential security maps” were created to shade out predominantly black neighhborhoods.
Whites were able to take advantage of mortgages for lower-priced homes but African Americans, Latinos, Italians and Eastern European living in and around the same areas were not. The report explained how the two federal agencies created 30-year mortgages that transferred a tremendous among of real estate wealth to the mainly “White Anglo Saxon Protestant” middle-class. Lepley and Mangiarelli explain the net effect of the racially discriminatory practice in their report.
“They did this while simultaneously backing explicit racial-discrimination, racial segregation, and racialized poverty as policies of the federal government, then passed these practices on to private lenders. The practice of redlining and racial discrimination in the home-lending market continued legally until 1968, with the passage of the Fair Housing Act, but even in the twenty-first century lenders have been prosecuted by the Department of Justice for engaging in redlining. American society has internalized the belief that nonwhite neighborhoods are not worthy of credit.”
The report’s authors showed Cuyahoga County’s “redlining” map in 1940 and contrasted it to the same “illegal” one that exists today.
“The segregated living patterns of the Cleveland area are nearly unchanged after 76 years,” the reports authors conclude.
Because Gilbert and the other lenders don’t see mortgages for homes under $50,000 as “profitable,” the majority of Cleveland’s neighborhoods in a city with a nearly 6o percent black population are gettng no love from the owner of the Cleveland Cavaliers. Their money was good enough to help him renovate the Quickens Loan sports arena. It’s not good enough for monthly and affordable mortgage payments of $400.
Cleveland city council didn’t get any real benefits for Cleveland from its “community benefits agreement” with Gilbert in exchange for $88 million in public funds.
The other redlining mortgage lenders are Howard Hanna Mortgage Services, First Federal of Lakewood, Third Federal Savings & Loan, Fifth Third Bank, Huntington National Bank, Wells Fargo, PNC Bank, JP Morgan Chase Bank and Cross Country Mortgage.
