By Jasmine Browley ·Updated December 17, 2023
The largest credit union in the US is facing allegations of racially biased lending practices per analysis conducted by CNN.
The outlet recently reported that Navy Federal Credit Union, a financial entity that provides banking services to military people and their family members pushed through home loan applications for 75% of the White borrowers, but less than 50% of Black borrowers who went out for the same loans were denied.
CNN found that the nearly 29-percentage-point gap in Navy Federal’s approval rates was the largest among any of the 50 lenders that originated the most mortgage loans last year, per its report.
Perhaps the most bombshell finding from the report lies in the information around the incomes and debt-to-income ratios between the two racial applicant pools. According to the outlet, Navy Federal approved a higher percentage of applications from White loan-seekers that earned less than $62,000 a year than it did of Black borrowers making $140,000+ annually.
As ESSENCE previously reported, despite recent reports of lenders denying mortgages to Black applicants more than white applicants have spread like wildfire, this isn’t a new phenomenon. Redlining has been around for generations, and unfortunately, its effects still echo through Black household today.
CNN reported that Navy Federal denied nearly 3,700 Black home loan in 2022. It was was found that the credit union approved Latino borrowers less than White borrowers as well.
“Navy Federal Credit Union is committed to equal and equitable lending practices and strict adherence to all fair lending laws,” a Navy Federal rep shared in a statement as reported by CNN. “Employee training, fair lending statistical testing, third-party evaluations, and compliance reviews are embedded in our lending practices to ensure fairness across the board.”
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