Buying a home seems like the quintessential American adult experience. At least I assume it is; I’m a millennial so I don’t own my home. I’m much too broke after paying to survive. But I would love to own a home! Getting something in my own name that I could remodel a là Joanna Gaines is the dream. Don’t like the kitchen? Who cares! Change it! Don’t like that bush outside? Rip it out! Plant an herb garden!

Yes, hopefully one day I’ll own a home. I’ll go into a bank (or more likely, go online to their website), I’ll fill out the paperwork, and I assume I’ll get a pretty good interest rate. I have great credit and a stable income. Nothing in the world is preventing me from getting a house except I don’t have 20% of around $250,000.

But what if it wasn’t so straight forward? What if I hadn’t grown up in (predominantly) white middle class suburbia? What if I was born and raised on the “wrong side of the tracks?” What would my prospects look like then?

You might be asking yourself (or me) what skin color and neighborhood have to do with getting a home. “I worked hard to get where I am today” or “not everything is about race”. We’re not here to question your work ethic; after all, working hard to get ahead in life is the American dream! It is also true, though, that not everyone starts out on the same footing. And I, a white person with a solid income, have a better chance of even getting a foot in the door of the housing business. I’m not remotely concerned that when the time comes, I won’t be dealt a good interest rate or even get approved for a home loan. However, this may not be as true for a person of color.

Higher interest rates for people of color can’t be legal though, right? Well, not technically, but banks have been getting away with legally discriminating against people of color for decades. What originally began as a policy called Redlining was banned in the 60s, but banks today still come under fire for treating people of color differently than white people when it comes to home loans. What’s the history behind this?

Let’s take it back several decades to 1933. It was one of the worst years of the Great Depression, with effects all over the world. Hitler became Chancellor of Germany, and opened the first concentration camp in Dachau. South Africa hadn’t yet delved into the atrocity that was Apartheid. Japan was invading China. Western Australia was trying to secede from the rest of the Commonwealth of Australia. Great Britain still colonized many places that are countries on their own today. President Herbert Hoover had just lost his bid for re-election to Franklin D. Roosevelt.

FDR is remembered as a hero of American history for pulling our country out of the Great Depression, saving jobs and lives, and stepping the country into World War 2 in 1941 to help put an end to the Axis Powers. But as with all of American history since Europeans colonized this part of the world, events are more complicated than the simple “we were the good guys making all the good decisions” that helps us all sleep better at night. Oftentimes events in our history are straightforward for white people, but gray or straight up negative for people of color. FDR wasn’t a racist president, as far as we can see. Of course, many of our presidents literally had slaves so it didn’t take much to be on better terms than them. His policies were in fact frequently beneficial to people of color, but to understand the situation fully means we have to remember that Black people at the time were legally treated quite poorly. So he was a “friend” to Black people in that he was liberal and worked to help them, but they were still not on equal footing as white men. FDR was aware that if he fully sided with those who were marching for Civil Rights, he would lose many southern White votes so he took his time fully leaning into the cause of Black equality.

Sometimes it’s hard to stomach that our “heroes” aren’t faultless. It provides cognitive dissonance because we’re raised to see in black and white absolutes and act on those beliefs. In our textbooks, someone is either “good” or “bad” based on the few lines we’re given about their whole lives. But we’re not shown the shades of gray that tell us the whole story. George Washington was a great leader of our country, and yet he (and many of our presidents) owned slaves. Woodrow Wilson gave women the right to vote, but only after realizing that it would be political suicide to deny the female population that right any longer (and still black women were denied the right for many years.) He wasn’t actually a champion of women’s rights. Dr. Seuss is one of the most famous children’s authors of all time, and yet there’s rampant racism evident in his writing and illustrations. Franklin Roosevelt brought the US out of the Great Depression by enacting social programs and expanding the government’s responsibilities towards economic relief. But he also signed off on an order to allow hundreds of thousands of Japanese people residing in our country (62% of whom were US Citizens) to be locked up into internment camps of our own making, without any sort of due process.

What does all this have to do with redlining? Well, Roosevelt was inaugurated and immediately began work on what was deemed the “New Deal.” FDR’s New Deal has to be something we all remember from history class, if not the specifics then at least the name. In this deal, Congress, through committees, and the President, through Executive Orders, instituted programs that would help to pull the country out of its economic slough. FERA, the precursor to our Social Security program, was born in these first 100 days of FDR’s presidency. (In fact, this was the first presidency in which the “first 100 days” was a thing. This has become common to use as a gauge to see what a new president is accomplishing right away.) You might recognize the FDIC and the SEC, also formed during this time.

The Home Owner’s Loan Act was another key action of the first 100 days meant to pull people out of poverty and help with their delinquent mortgages. Part of this process included surveyors outlining different zones in cities and deciding which zones were eligible for loans. “Redlining” was the act of literally drawing red lines around portions of the city that were deemed “undesirable” to loan money to for homes. These areas typically were inhabited by minorities, frequently African Americans and Jews.

Take a look at these excerpts which briefly discuss redlining and its effect on communities:

Otherwise celebrated for making homeownership accessible to white people by guaranteeing their loans, the Federal Housing Administration explicitly refused to back loans to black people or even other people who lived near black people. As Ta-Nehisi Coates puts it, "Redlining destroyed the possibility of investment wherever black people lived." (source)

As a consequence of redlining, neighborhoods that local banks deemed unfit for investment were left underdeveloped or in disrepair. Attempts to improve these neighborhoods with even relatively small-scale business ventures were commonly obstructed by financial institutions that continued to label the underwriting as too risky or simply rejected them outright. When existing businesses collapsed, new ones were not allowed to replace them, often leaving entire blocks empty and crumbling. Consequently African Americans in those neighborhoods were frequently limited in their access to banking, healthcare, retail merchandise, and even groceries. One notable exception to this was (and still is) the proliferation of liquor stores and bars which seemingly transcended the area’s stigma of financial risk. (source)

Neighborhoods which were redlined weren’t popular with companies looking to grow or start a business, and therefore employment became more and more complicated of an issue. This led to a rise in crime, as people turned to feed their families any way they possibly could. The crime rates then led to the neighborhoods fulfilling their destiny as “bad investment zones” in the eyes of the banks, so this problem, created by the government, became a vicious cycle.

The lack of investment in these areas contributed to landlord abandonment, which created empty spaces for criminal activity to prosper. Redlined areas were also the first to be mowed down when the Federal Highway Act was created. This displaced people living in those areas, further contributing to homelessness in those areas.

Redlining was officially outlawed in 1968 [FACT CHECK] but the problems were not solved right away and in many places still have not been solved. Redlined areas were left at a stand-still and as noted above, in a “state of disrepair,” while the rest of the country moved forward. Businesses started up in other areas and grew, white homeowners continued to gain equity while minorities struggled to even get a loan to buy a home. In a 1999 paper entitled “Racial Discrimination and Redlining in Cities,” authors Zenou and Boccard make the argument that black people who live in the “ghetto” (their word) have less of a chance of suburbanites to get a job.

The reason the Dream Center exists is because homelessness exists. We believe that it’s a human problem that we can work together to solve, and part of solving that problem is understanding the many ways in which our systems have worked against some members of society both in the past and present so that we can use our place in life to stand up and say “hey - that’s not ok, and we won’t be supporting this kind of behavior.” We need to speak up because if the only people who speak up are the ones directly affected, nothing will change.

Homelessness is a multifaceted topic. It isn’t easy to identify the root causes because there are so many root causes. One of those is the disenfranchisement of people of color from the very start of this country, and one way we can work toward the goal of ensuring every person has the safety of a roof over their heads is to understand our history as a country and identify our privilege, and use it to lift up those who do not have what we have.

“Redlining was banned 50 years ago. It’s still hurting minorities today.” The Washington Post
Commission on Wartime Relocation and Internment of Civilians, Encyclopedia
Blacks and Hispanics face extra challenges in getting home loans, Pew Research
“Is the Cat in the Hat Racist?”, School Library Journal
The Living New Deal

Modern-Day Redlining: How Banks Block People of Color From Home Ownership, The Chicago Tribune
Redlining, Black Past
The Racist Housing Policy that Made Your Neighborhood, The Atlantic
Racial Discrimination and Redlining in Cities