INEQUITIES

Asian Paci c American Community Development found language barriers are also often a challenge for members of the Asian American community when pursuing homeownership. In addition to conversations with lenders, real estate paperwork and documents rarely come in languages other than English.

Debt-to-income ratio

Over the last couple of years, Brandon Stepter, a community consultant, has been working in Broomeld. In an e ort to bring more people of color into the community, Stepter looks at housing infrastructure, housing practices and community practices.

Stepter and his wife, Gabrielle, both of whom are Black, have been renting in Aurora but have recently been looking to purchase a home.

“We thought we would be pretty solid in that regard and we both make a decent amount of money,” Stepter said. “We thought we would be able to start looking, even in this market, to try and nd an equitable home that ts our budget.”

Stepter, who also works as a healthcare administrator, and his wife, who works for a technology company, said they are trying to gure out how to pay o their student debt so they can get a home loan within the next couple of years.

“I think right now what we’re seeing is a lot of younger African Americans who are in copious amounts of student debt and that has been preventing them from owning a home,” Stepter said. e Black Business Initiative is a Denver-based organization that focuses on economic equity in the Black community.

Debt-to-income ratio is often a signi cant barrier for Black people who are looking to buy a home because that number is assessed when underwriters are deciding whether or not to give a mortgage, according to Jice Johnson, founder of the Black Business Initiative.

“In America, you are encouraged to graduate high school and go to college,” Johnson said. “Typically speaking, because you don’t have access, when you go to college you’re not going to pay for college outright. Instead, you’re going to get a student loan … So it increases the debt side of your ratio by a lot, oftentimes preventing you from purchasing a home.”

Black college graduates tend to owe thousands of dollars more in student debt, on average, than their White peers. According to a 2016 report from the Brookings Institution, the amount can exceed $7,000 at the date of graduation.

Black and Hispanic workers also tend to be paid less than their White counterparts, according to many studies on the subject. In 2020, Black workers in Colorado earned 74% and Latino workers in Colorado earned 71% of the hourly earnings of White workers, according to numbers from the 2020 ve-year American Community Survey.

“So you go to school, you get the degree, which is what you’re supposed to do to get the high-paying job,” Johnson said. “Now you come out and you have debt and also your income isn’t as high as it should be. So, your entire debt-to-income ratio doesn’t allow for you to purchase a home.”

Discrimination

In a national statistical analysis of more than 2 million conventional mortgage applications for home purchases, a data-based news publication called e Markup found that lenders were 40% more likely to turn down Latino applicants for loans, 50% more likely to deny Asian/Paci c Islander applicants, 70% more likely to deny Native American applicants and 80% more likely to reject Black applicants compared with similar White applicants.

Even for families of color that may not struggle immediately with wealth and knowledge disparities, discrimination persists in the housing market. People of color are often treated di erently in appraisals, lending practices and neighborhood options.

Stories about what that looks like in the Denver area abound. Johnson of the Black Business Initiative lived in Westminster before moving to Aurora. When she was staging her home to sell, her real estate agent gave her some advice.

“It was encouraged for me to make sure I had no family photos up,” she said.

Meanwhile, she visited homes for sale that had photos of White families.

Johnson said it was good business advice. Her Black Realtor, Delroy Gill, understood the landscape and was looking out for her.

“ at’s my Realtor trying to get me top dollar,” she said. “ e question is, why would (leaving) my photos prevent me from getting top dollar?”

Gill said the practice of taking down photos removes potential hurdles that could occur for his clients.

For Black clients, race is sadly one of those hurdles that could a ect how appraisers, inspectors and potential homebuyers view the home, he said.

“We do know racism is a real thing,” he said. “And it exists in every facet of life. So therefore, when you are faced with the unknown, it’s better to make the adjustments based on how society is versus taking the risk of creating more damage on Black wealth by them receiving less funds for their homes.” e advice Gill gave Johnson was not unique. Paige Omohundro, business development manager at the Colorado Housing and Finance Authority said her team heard similar stories in recent focus groups with real estate agents, nonpro ts, lenders, housing advocates and people trying to achieve homeownership in Black and African American communities. She said these stories were shared by members of Hispanic and Latino communities as well.

Gill said that because of his precautions, discrimination rarely impacts his clients’ sales. One time, however, the preparation was not enough.

A couple of years ago, Gill was working with an interracial couple to sell their home in Parker. When the appraiser arrived, the Black husband was leaving the property.

“I own investment properties in the area, so I know the area very well,” Gill said. “And I used to live in the neighborhood. So the value that we gave to the house was very appropriate — and the appraisal came in $100,000 less (than our value).”

According to Gill, the buyers, who