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Open House

Discrimination in Mortgage Lending; Controversial Plan Would Break up Fulton County, Georgia, Along Race and Class Lines; Historic Harlem

Aired February 17, 2007 - 09:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

GERRI WILLIS, HOST: Good morning.
In today's OPEN HOUSE from Atlanta, we take a look at a problem that we hoped didn't exist anymore, discrimination in mortgage lending. It's just one of the many topics we tackle today as we look at racism in America.

First up, mortgage meltdown. You'll meet one woman who says she was discriminated against and fought back.

(BEGIN VIDEOTAPE)

WILLIS (voice over): Owning your own home is the American dream. But it may be out of reach or at least harder to reach for some Americans than others. Some, like Nannatte, who asked us to withhold her last name, say it all depends on the color of your skin.

(on camera): What does it feel like?

NANNATTE, CLAIMS DISCRIMINATION: It makes you feel like you want to just punch the world. I mean, it's -- it's just so unbelievable to not like someone, to not trust someone, to not give someone a chance because of their skin color, because of their race. To me, especially in a bank, because green is the only color I think they should look at.

WILLIS (voice over): From the bank's point of view, Nannatte, like millions of Americans, may not be the perfect loan candidate. She has a low credit score and had previously filed for bankruptcy, but she still chased her dream.

NANNATTE: I have two boys, so I wanted a house for them, a yard for them, you know, for us.

WILLIS: But when Nannatte applied for a loan with Fifth Third Bank to buy her dream home in 2003, she was turned down. Nannatte's story might have ended there, except she works in the industry and refused to take no for an answer.

NANNATTE: And I started writing letters. I started emailing. I wrote a letter to HUD.

WILLIS (on camera): The Department of Housing and Urban Development.

NANNATTE: Yes. And they're the ones who contacted me back and got in touch with the bank.

NANNATTE (voice over): HUD agreed to investigate and found that at the same time that Nannatte was turned down for a loan, people with similar or even weaker financial histories were approved by the bank, and nearly all of them were white. In a statement sent to CNN, Fifth Third Bank said it "stands by our lending practices."

Federal law prohibits race playing any part in the lending process, but one nonprofit organization says their studies have shown it still happens all the time.

JOHN TAYLOR, NATIONAL COMMUNITY REINVESTMENT COALITION: We've sent testers into six major metropolitan areas and, you know, it was just rampant. I mean, the difference in treatment that people get -- we're controlled for credit scores, we're controlled for employment history, we're controlled for how much income they had. And despite of all that, you know, 45 percent of the time, better products are offered to the whites.

WILLIS: And what are those not-so-hot deals the others are offered? Something called subprime loans, geared toward people with less than perfect credit and often carrying much higher interest rates.

Another study, this one by the Center for Responsible Lending, found that borrowers of color were 30 percent more likely to receive a higher rate loan than white borrowers, even after accounting for differences in credit scores and other risk factor differences. But industry insiders argue that there is no racism in their industry, and cases like Nannatte's are isolated.

DOUG DUNCAN, MORTGAGE BANKERS ASSOCIATION: I've been in the mortgage arena for about 15 years now, and for about 13 of that, I've -- that's been an issue that's been on my plate and responsibility. And I have yet to see any systematic evidence of differential treatment for racial groups in all the research that I've seen that has borne scientific scrutiny.

WILLIS: Both groups say their studies are absolutely scientific and stand by their results. But for now, the reality for Nannatte is she didn't get the house of her dreams.

(on camera): What did you tell your kids?

NANNATTE: I couldn't tell my two boys, I couldn't say it out loud, "We did not get that house because mommy is African-American and they didn't want to give her a chance."

WILLIS: Nannatte did get a chance and a house, thanks to her persistence and help from HUD. And she also got a $125,000 settlement from Fifth Third Bank, though they denied any discriminatory lending.

(END VIDEOTAPE)

WILLIS: If you think you're a victim of mortgage discrimination, keep this in mind -- every American has the right to fair housing. A mortgage lender can't deny you a loan because of your race, where you come from, your religion, age, or marital status, or because you receive public assistance income. You shouldn't be asked about your plans for having or raising children.

It's a good idea to get a copy of your credit report before you apply for a mortgage. Credit reports can contain errors. That can hurt your chances of getting the most ideal mortgage terms.

If you're rejected for a mortgage or if you were offered less favorable terms than you applied for, make sure you get the reasons why within 60 days. Your lender is required to tell you.

Still ahead on OPEN HOUSE, "Uncovering America." A controversial proposal in Fulton County, right here in Atlanta.

Plus, a difficult decision that residents of a Dallas neighborhood are facing.

And the struggle in Harlem. But one may not expect.

(COMMERCIAL BREAK)

WILLIS: Welcome back to OPEN HOUSE, "Uncovering America."

A controversial plan would break up Fulton County along race and class lines.

(BEGIN VIDEOTAPE)

WILLIS (voice over): A storm is brewing under Georgia's Capitol dome. State representative Jan Jones has introduced a bill designed to allow the wealthier northern sections of Fulton County to split apart and form their own county.

JAN JONES, GEORGIA STATE HOUSE: Fulton has a long history and a very public history of not offering services well. Just about every aspect of service delivery has had and been marked by deep, pervasive problems.

WILLIS: Jones says it's about providing better government to citizens who want more local power and lower taxes that the proposed new county of Milton could provide. But opponents say it would leave the poor southern parts of Fulton County with less tax base and weaker county services.

VINCENT FORT, GEORGIA STATE SENATE: If in fact the Milton County succession succeeds, Grady Hospital is in a lot of trouble. The library system would be decimated. The MARTA -- the public transit system would lose sales tax revenues.

WILLIS: And, Fort says, at the deepest level, it's an issue of race, the whiter northern sections leaving behind the blacker southern parts of the county.

FORT: I do a blog alert. And they are not saying good things about those of us who are objecting to this. So -- and it's -- you know, it's bordering along just outright and bigotry in some of that -- those blogs.

JONES: It's easier to pull out an unwarranted race card than it is to face the bright light of scrutiny on a broken government.

WILLIS: The proposition faces huge obstacles, needing a two-thirds majority in the legislature, the governor's signature, and a "yes" vote from more than half of Georgia's citizens. That process won't be complete for at least two more years.

(END VIDEOTAPE)

WILLIS: Atlanta bills itself as a city of racial tolerance. What's its progress like today? I spoke to Clark Atlanta University political science professor, William Boone.

(BEGIN VIDEOTAPE)

WILLIS: Atlanta has seen so much growth in the last few years. And the city really likes to pride itself on race relations being positive.

Are they still, or has that changed in any way?

PROF. WILLIAM BOONE, CLARK ATLANTA UNIVERSITY: Not at all. The city is still what one would call a chamber of commerce type city. It's a city that does a lot of (INAUDIBLE) about itself, it's a city that likes to portray itself as always in the forefront and cutting edge for race relations and development of the South.

WILLIS: And is that even more true now...

BOONE: Yes.

WILLIS: ... because of the great growth?

BOONE: Yes, it's even more so now, because even though you've had a change of administration in terms of complexion, it's not really changed the overall paradigm out of which they operate. That is, everybody tends to think that development and business is the thing. And no matter the color of administration, business is first.

WILLIS: Well, I've noticed that in the census data, for example, you're starting to see whites moving into the city.

BOONE: Yes.

WILLIS: You're seeing African-Americans moving out of the city. And that is against -- contrary to the typical kinds of settlement patterns you've seen.

What has that meant as a practical matter?

BOONE: It's been a couple of things, especially on the political question, because what it means is that, in a very short time you may have another white mayor. That's the problem for some folks. But I think if you look at the data a little more carefully, what you'll see is that certainly you have an increase in whites returning to the city. But you also have an increase or a sort of staying by the black middle class, upper-income class of the black folk, who also are enjoying the benefits of the city.

WILLIS: What about gentrification? Is there a downside to gentrification for the city?

BOONE: It exploded over in east Atlanta, where you had gentrification taking place. You had a group of people, affluent, mostly whites, coming in who were changing the mix of that area. Pit it against long-term black residents, elderly residents, and of course, the city's happy because it's going to get...

WILLIS: Their revenues are going up.

BOONE: Are going up.

WILLIS: Well, on the other hand, you've had African-Americans moving out into the suburbs, right? Which is a change.

BOONE: Yes, we do. Yes. Yes.

Well, blacks in this city have been moving to places like DeKalb County. They have started to move even west to Cobb County, which is interesting, because Cobb County's always been resistant to the presence of whites -- blacks, rather. But south DeKalb, which is east of Atlanta, has been more recreptive, and you're going to find a rather substantial black middle class in the southern part of that county.

(END VIDEOTAPE)

WILLIS: Up next, how one NFL player has made a big difference to the lives of many Atlanta residents here.

Plus, a Dallas neighborhood set up 50 years ago for African-American residents.

And historic Harlem, it's made a lot of progress, but has a ways to go.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

WILLIS: Forty years ago, Dr. Martin Luther King preached from the pulpit of this church, the Ebenezer Baptist Church in Atlanta. And 50 years ago, a neighborhood on the outskirts of Dallas was established specifically for African-Americans. Now that neighborhood is at a crossroads.

(BEGIN VIDEOTAPE)

WILLIS (voice over): Fifty years ago, it was the middle of nowhere. Hamilton Park was set up as an African-American community on the outskirts of Dallas. Now it's in a prime location, surrounded by two major highways, a new light rail service, and corporate offices. That is bringing change to this small neighborhood that has stayed the same size since 1954.

PASTOR ROBERT PRICE, NEW MOUNT ZION BAPTIST CHURCH: Hamilton Park was the premier of the many communities that we had. Didn't have a lot for the black homesteaders, but Hamilton Park become the premier.

THOMAS JEFFERSON, HAMILTON PARK CIVIC LEAGUE: Now, this community was built by blacks. It was for blacks, and there is a very historical story behind Hamilton Park itself. It's a story that should be continuously told, it's a story that should be continuously heard.

WILLIS: Many of Hamilton Park's residents are now over 80 years old, and homes they may have purchased for $6,000 are now worth over $100,000. To developers, this prime piece of real estate may be worth even more.

JEFFERSON: The selling of Hamilton Park wouldn't be a good thing for Hamilton Park, not as history is concerned. The earth is something that is a part of a person. This Hamilton Park is a part of me.

WILLIS: Now these men are trying to save their community from development that could damage the character of Hamilton Park.

PRICE: We're going to keep relating to senior people -- don't worry. And we're going to try to also through the civically (ph) and the churches, train the younger people the value of what they have.

(END VIDEOTAPE)

WILLIS: Another neighborhood at a crossroads, New York's Harlem. It's a subject of growing debate between those who would like to develop it and those who would like to preserve it. I spent an afternoon in Harlem with architectural historian Michael Henry Adams.

(BEGIN VIDEOTAPE)

WILLIS: So we're in Harlem, Strivers' Row. Tell me why this block is so significant.

MICHAEL HENRY ADAMS, ARCHITECTURAL HISTORIAN: Because this was the place where every African-American wanted to live, once the Equitable Life Insurance Company opened it up for black people to be able to buy in 1919. And so you had everyone from the prize fighter Harry Willis (ph) to Eubie Blake, the composer, who all wanted to live on Strivers' Row, and they all bought houses in this particular neighborhood.

WILLIS: They're really beautiful buildings. But I bet they're really, really expensive now.

ADAMS: There was not a single house that had ever sold for more than a million dollars until the year 2000. Now you're looking at houses like this that are valued at $3 million and $4 million.

WILLIS: Talk to me a little bit about Harlem and its role really as a center for African-American culture.

ADAMS: Well, you know, African-Americans flocked to Harlem around 100 years ago. You had just a preponderance of people who were also very talented -- artists, musicians, writers. And this gave rise to the Harlem renaissance of the 1920s and the early 1930s, everyone from Lord and Lady Louis Mountbatten, to Cole Porter, and Noel Coward. They all came to Harlem.

WILLIS: Michael, did African-Americans own here? I know there was lots of issues with red-lining.

ADAMS: It was a very small percentage of people who actually owned property here, and that continues to be the difficulty even today.

WILLIS: Harlem is changing. Gentrification coming. What does that mean? I mean, is it a good thing, is it a bad thing?

ADAMS: Harlem is finally becoming the place that we always dreamed it could be. But the nightmare is that so many of us, like me, don't readily see a place for ourselves there, because we're being priced out of a place that we came to because it was affordable.

WILLIS: What are the other results of this kind of, you know, incredible boom in real estate? Are you -- are landmarks in the crosshairs of developers? Are you losing any buildings that you think are really significant?

ADAMS: Oh my gosh, there are buildings being lost all of the time on 125th Street and all over the place, which is going to be so injurious to the traditional character of Harlem.

This building was built as a renaissance casino. This was the epicenter of parties in Harlem, but it was also the place where the Harlem Rens basketball team performed. It was the first professional African-American basketball team. Well, now they want to tear this down so you can see the side of the church.

WILLIS: So let's talk about some of the landmarks of Harlem.

ADAMS: The only house that Alexander Hamilton, the first secretary of the Treasury, ever owned is right here in Harlem.

For 180 years, 125th Street has been the main shopping artery of Harlem. With the proposed rezoning of 125th Street, which would allow for a much greater density, much greater heights, I think that you're in danger of transforming 125th Street into a canyon of towers like you have, say, on Wall Street. And I think that that would do so much to kill the legendary character of Harlem.

If Harlem is like every other place, what's the point?

(END VIDEOTAPE)

WILLIS: Up next from Atlanta, how one NFL star is helping those less fortunate achieve the American dream, when OPEN HOUSE, "Uncovering America," continues. (COMMERCIAL BREAK)

WILLIS: Welcome back.

We're in the Georgia Dome, home to the Atlanta Falcons. Right now it's being used for college basketball, as you can see, but on any given Sunday in the fall, you can catch the Falcons' running back, Warrick Dunn. His contributions on field are impressive, his contributions off field even more so.

(BEGIN VIDEOTAPE)

WILLIS (voice-over): Taking the ball and running with it comes naturally to NFL star Warrick Dunn. It always has. But that doesn't mean it's always been easy.

WARRICK DUNN, NFL PLAYER: My mom, she died when I was 18 years old. Single, six kids, made $36,000.

WILLIS: Overnight Warrick went from big brother to head of household.

DUNN: There were six of us all together. So I became a father, like, instant.

WILLIS (on camera): You were how old?

DUNN: I was 18, a senior in high school.

WILLIS: And how old were the kids?

DUNN: Well, 16, 15, 12, 11, 10, I think.

WILLIS: So you had -- you had teenagers as a teenager?

DUNN: Well, I had them at the worst years ever.

WILLIS: How did she die? DUNN: Well, she was gunned down in the line of duty. She was working extra duty at a Piggly Wiggly grocery store. And she was in her uniform, a police car. They had to go make a night deposit, and I guess the guys followed her for a little while. So after a while they just pretty much ambushed her, set her up.

I guess I'm just thankful.

WILLIS (voice-over): While chasing his own dreams, Dunn never forgot his mom's, owning a home. After signing his first NFL contract, Warrick planted the seeds for what become the Warrick Dunn Foundation...

DUNN: Congratulations to your new home.

UNIDENTIFIED FEMALE: Thank you.

WILLIS: ... and Homes for the Holidays.

UNIDENTIFIED FEMALE: Oh my goodness. Thank you. WILLIS: Shiranda Russell (ph), a working single mom and full- time student, is one of 64 families the NFL star has helped achieve the dream of home ownership.

UNIDENTIFIED FEMALE: It feels absolutely fabulous. I am at a loss for words. We're just really excited and thankful for this holiday wish. My dream has come true.

Oh, look at my bed.

DUNN: What we do is we give them the down payment, but we also furnish the house with food, linens, furniture, garden tools, et cetera, et cetera. So we pretty much just try to get those guys to the point all they have to do is just bring their clothes.

WILLIS: Warrick's charity lends a helping hand but is not a handout. Families work with counselors to get their finances in order and put in what's called sweat equity, which is building homes through a partnership with Habitat for Humanity.

DUNN: It's going to be different. It's going to be a challenge to them. But at the same time, I just think she's prepared.

WILLIS: Through Homes for the Holidays, Warrick is doing for others exactly what his mom did for him, preparing them for the future.

DUNN: I'm thankful that I've had this opportunity. I've been blessed all my life to play a game that I love. But also, I'm blessed to be able to help people.

(END VIDEOTAPE)

WILLIS: Warrick Dunn isn't just an inspiration to the people he helps, he also inspires other NFL players to set up housing programs of their own in their hometown.

As always, we thank you for spending part of your Saturday with us.

OPEN HOUSE will be back next week, right here on CNN.

You can also catch us on "HEADLINE NEWS" every Saturday and Sunday at 5:30 p.m. Eastern Time.

And there'll be much more on "Uncovering America" on CNN in the coming weeks.

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