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Identification of Barriers to Fair Housing Choice <br />A. The Sale or Rental of Housing <br />i. Assisted Housing <br />There is a reluctance on the part of local landlords to rent to persons receiving <br />government assistance. In the Chapel Hill-Carrboro area this problem is more acute <br />since low income families are often forced to compete with students when .locating <br />adequate, affordable rental housing. <br />ii. Other Rental Housing <br />Availability and affordability are the key barriers in securing rental housing in the <br />County. In the northern parts of the County, the rental housing. stock is slim with <br />only a handful of multifamily housing complexes. The rental market consists of <br />single family homes and mobile homes which are often difficult to locate because of <br />the rural nature of this area. In the southern parts of the County, particularly Chapel <br />Hill and Carrboro, families are often forced to compete with students when locating <br />adequate, affordable rental housing. <br />iii. Provision of Brokerage Services <br />No major impediments are identified. <br />iv. Provision of Financial Assistance for Dwellings <br />In Orange County, four of the ten leading lenders by market shares are either <br />mortgage or finance companies. The high rate of denial of minority borrowers (4:1) <br />is an impediment to equal housing choices in Orange County. The leading lender to <br />Hispanics in Orange County is Oakwood Acceptance Corporation, a subprime lender. <br />African-Americans received more than twice the number of loans from subprime <br />lenders than prime lenders. <br />Subprime lending or B&C Lending are loans made to borrowers with past credit <br />problems at higher cost than conventional loans. The costs of subprime loans are <br />higher than the costs of conventional loans. Statistics have shown that subprime <br />loans are often made to persons who could or should have been given a prime. loan. <br />This practice, along with some others, is termed predatory, and is unethical and <br />makes it difficult for some borrowers to obtain mortgages. <br />Further analysis shows that subprime lenders make proportionally more loans to <br />minority borrowers in minority neighborhoods than they do White borrowers in <br />.White neighborhoods at the same income level. The actual number of subprime <br />lending could be much higher, in as much as, sixty-six percent of all mortgage and <br />finance company loans were not reported under the Home Mortgage Disclosure Act. <br />Therefore, compliance with the spirit of the Community Reinvestment Act. has been <br />slow in achieving major shifts in statistics for loans to minority County residents. <br />19 <br />