Paying your bills on time is racist?

Financial reporter John Carney — brother of Examiner political columnist Tim Carney — reports at MSNBC that bank credit standards are going to be challenged as racist:

Banks will be accused of employing discriminatory credit standards when making mortgages in a series of fair housing complaints that a national consumer coalition plans to file beginning next week.

The National Community Reinvestment Coalition plans to challenge the widespread practice of requiring borrowers asking for FHA-backed loans to have higher FICO scores than the minimum required by the FHA, according to a report from Ken Harney at New Times.

The FHA requires a minimum FICO score of 500. Borrowers with down-payments as low as 3.5 percent must have a score of at least 580. Borrowers with scores between 500 and 580 must put a minimum of 10 percent down.

Note the median FICO score ins 723. But requiring a score of at least 580 to get a home loan with only 3.5 percent down is racist? Huh?

alleged racismBeltway ConfidentialmortgagesUS

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