Today CRL submitted the following letter to the editor of Bloomberg, publisher of Bloomberg Businessweek:
The Bloomberg Businessweek Feb. 21 story on the recovery of the housing market, A Phoenix Housing Boom Forms, in Hint of U.S. Recovery, was factual and informative. The magazine cover highlighting this story was anything but. Instead, the cover perpetuates myths about the reasons for the last housing boom, and reinforces disparaging stereotypes about the people hurt most by the housing crash.
Your cover completely distorts or ignores the following facts:
- People of color were targeted for risky, expensive subprime loans, even though many were qualified to receive safer, lower-cost prime loans. This has resulted in a disproportionately higher level of foreclosures for these borrowers.
- During the housing boom, mortgage lenders and brokers were paid more to push riskier products and didn't underwrite the loans.
- Affordable housing and Community Reinvestment Act loans accounted for a tiny share of the subprime mortgage market; most people who got subprime loans already owned their homes and were paying their mortgages successfully.
Bloomberg's reputation and credibility are undermined by the inflammatory and unfair cover. Your public apology for sparking a strong reaction to the magazine cover is hardly an adequate response. You owe your readers a fuller accounting of the true story behind the housing crisis, to correct the deceptive picture the cover portrays.
****************
For more information, contact Kathleen Day in DC at 202.349.1871 or kathleen.day@responsiblelending.org; Graciela Aponte in Calif. at 510.379.5518 or graciela.aponte@responsiblelending.org; or Ginna Green at 510.379.5513 or ginna.green@responsiblelending.org.