Redlining

Redlining is the practice of denying or limiting financial services, such as mortgage loans and insurance, to residents of a neighborhood on the basis of race or ethnicity rather than individual creditworthiness. The term comes from maps the U.S. Home Owners Loan Corporation began drawing in the 1930s, which outlined minority neighborhoods in red as too risky for lending, systematically starving Black, Mexican American, Jewish American and Italian American communities of investment. The Fair Housing Act of 1968 and the Equal Credit Opportunity Act of 1974 made the practice illegal in the United States, but its effects persist in the racial wealth gap and in newer variants such as reverse redlining, which targets minority borrowers with predatory loan terms instead of refusing them credit outright.