A comprehensive analysis by CNN has brought to light significant racial disparities in mortgage approvals at Navy Federal Credit Union, underscoring broader challenges in Pensacola's housing market.
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The findings, published yesterday, reveal that Navy Federal, a key regional employer and the largest credit union in the United States, denied more than half of its Black applicants for conventional home purchase mortgages in 2022. This disparity of nearly 29 percentage points between White and Black borrowers is the most significant among the nation's top 50 lenders. Hispanic borrowers, too, faced lower approval rates compared to White applicants.
CNN’s analysis, based on publicly available data collected under the Home Mortgage Disclosure Act, showed that Black applicants to Navy Federal were more than twice as likely to be denied as white applicants. This disparity could not be explained by variables like income, debt, property value, down-payment size, or neighborhood characteristics.
Bill Pearson, a spokesperson for Navy Federal, said the CNN analysis did not “accurately reflect” the credit union’s lending practices, because it neglected “major criteria” used to evaluate borrower risk like credit scores, available cash deposits, and relationship history with the lender.
CNN noted that this information was not available in public mortgage data and claimed that Navy Federal had declined to provide this data when asked. What the data did reveal was that less than a quarter of Black applicants whose applications were rejected by Navy Federal were denied financing because of their “credit history.”
The revelations come amid an escalating housing crisis in Northwest Florida that has placed issues of housing and equity top of mind for many residents.
A Pensacola News Journal analysis published earlier this month found that the average city resident made about $14,070 less than they would need to make in order to afford a median-priced home in Pensacola.
The Escambia County Quality of Life survey, funded by local developers and philanthropists Quint and Rishy Studer and presented by the Pensacola Young Professionals, revealed that cost of living and property insurance were key concerns affecting residents’ quality of life.
Only 11% of respondents said they felt positive about finding affordable housing in the area, the lowest number since the survey began in 2008. Among Black residents, this number was even lower, at just 4%.
The City of Pensacola’s annual resident satisfaction survey came to similar conclusions, with nearly a quarter of respondents listing homelessness as among their top two policy priorities, the largest percentage for any of the issues on which residents were surveyed.
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