PREPARED REMARKS FOR
SECRETARY OF HOUSING AND URBAN DEVELOPMENT
TUESDAY, MAY 15, 2007
Thank you, Clifford (Turner).
And thank you, Steve Cook, for your good work.
Good afternoon. Let me begin by congratulating the winners of the HOPE Leadership Awards. Well done! Amazing! Thank you for your commitment to America's minority communities. Your work is an inspiration and a triumph. It shows that there are creative, profound ways to assist our minority communities to find affordable, fair housing. Through your fine efforts we have powerful stories of progress, commitment, and community involvement.
Today, all of us congratulate you.
I also want to thank the organizers of this event. It speaks well of the housing industry that it can come together in this way. Your cooperation turns the powerless into the powerful, and the left-out into homeowners. This partnership helps fulfill the American Dream for hundreds of thousands of our citizens.
I also congratulate the panel of judges, which included one of my predecessors at HUD, Secretary (Henry) Cisneros, for choosing the award winners. The judges certainly found stories that illustrate the power of one individual or corporation to make a memorable difference.
Ladies and gentlemen, the HOPE Awards are designed to help "close the divide in the American Dream." These awards emphasize that homeownership is for everyone - everyone!!! The awards are quickly becoming the premier event in the housing industry, setting a high standard of accomplishment and achievement. They capture the spirit of housing and homeownership.
A home is our stake in the community. Our home is where our family gathers for food, conversation, friendship, love, and respect. It is where we grow up together and grow old together. And I believe it is part of the American Dream because it gives us economic security, freedom, and opportunity.
Many first time and minority homebuyers face significant challenges when trying to purchase a home. In recent years, such difficulties have resulted in many of these individuals assuming risky, adjustable-rate, sub-prime loans. The impact on Black American and Hispanic/Latino borrowers has been particularly profound.
Let the facts speak for themselves. Minority homeownership remains 25 percent behind the national average, although under President Bush we have fought back by adding more than 3 million new minority homeowners. Studies show that half of all Black Americans still live in unaffordable, inadequate, or crowded housing. This remains true even if they are employed in important community occupations, like police officer, teacher or firefighter.
Affordable loans are hard to come by. According to one study, 40 percent of African Americans and 23 percent of Hispanics pay an interest rate three percent higher than the market rate. The Center for Responsible Lending reports that 51 percent of refinancing transitions in Black American neighborhoods are sub-prime loans. The loan denial rate is as much as twice as high for minority applicants than white households.
Credit problems persist for many Americans of color. And many recent immigrants fall victim to inappropriate lending practices because of credit problems. For example, one recent study found that 35 percent of Latino families don't have a checking account. This lack of credit history makes these families easy prey for the predatory lender and exotic sub-prime loans. Another study found that, in 2005, about 46 percent of Hispanics and 55 percent of blacks who took out mortgages got higher-cost loans, compared with about 17 percent of whites.
These problems extend across the financial spectrum. Just a few days ago, there was a report that minorities even pay more for car loans than the national average. These figures show a widespread, persistent pattern.
We can only improve minority homeownership through powerful partnerships, innovative thinking, and steadfast commitment to fairness, equity, and justice. If we can overcome these disparities, then we can change the face of homeownership in America. One study found that we can close the gap by half in the next ten years if we get fair loans to those with income. The study found that there are potential minority home buyers earning more than 95 percent of the area median family income. So, if we create a level field, the housing market will gain a significant number of minority homeowners.
That is why the President has made a public commitment to increasing minority homeownership. That is why we have tripled the money for housing counseling. That is why my department is vigorously enforcing fair housing laws, going after predatory lenders, and investigating inappropriate sub-prime loans.
There needs to be a mortgage alternative which will qualify a wide swath of borrowers and simultaneously provide them with the loan options they require. That is why the President and I want a modernized and reinvigorated FHA.
Everyone should have access to a safe, affordable mortgage product; and this should not change just because that person is a first-time homebuyer, a minority homebuyer. So we continue to have our work cut out for us.
But we have made a significant stride forward with the HOPE Awards. These awards show what can be done by one person or one organization. They highlight the difference of one voice. Imagine if we could multiply that one voice by another, and another, and by hundreds and thousands more.
Well, we see the answer today, right here in this room. When we unite together, when we join in common cause, then we can shatter any barrier, overcome any difficulty. We can change opinions, patterns, and traditions. In partnership, we can make a profound difference. We can make America a homeownership society for every citizen.
These awards are a major contribution to that goal. Thank you and, again, congratulations to the award winners.