Based on our analysis, it is clear that California’s African American and Latino borrowers are more likely to receive a higher cost subprime loan than a white borrower. The study found that African American and Latino borrowers are three times more likely to receive a higher priced subprime loan when compared to white borrowers. The study does not claim that discrimination necessarily accounts for the higher concentration of subprime loans among minority borrowers. Rather, the report criticizes the lending industries’ over reliance on so-called “objective” measures of credit risk
that can unfairly discriminate against minority borrowers.