Fair Housing
Redlining in Pennsylvania real estate refers to:
AA broker marking in red on maps which properties are under contract
BThe illegal practice of lenders refusing mortgage loans or offering worse terms in certain geographic areas based on the racial composition of the neighborhood✓ Correct
CThe practice of highlighting on a map the highest-priced properties in a listing presentation
DPennsylvania's policy of marking flood zone boundaries in red on county maps
Explanation
Redlining is the illegal practice — historically used by banks, insurance companies, and the federal government — of refusing to make mortgage loans or offering worse loan terms (higher rates, lower LTVs) in neighborhoods based on their racial composition rather than individual creditworthiness. The Fair Housing Act and the Equal Credit Opportunity Act prohibit lending discrimination.
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Key Terms to Know
Fair Housing Act
Federal law prohibiting discrimination in the sale, rental, or financing of housing based on race, color, national origin, religion, sex, disability, and familial status.
RedliningAn illegal practice where lenders or insurers deny services or charge higher rates in certain neighborhoods based on the racial or ethnic composition of those areas.
Loan-to-Value Ratio (LTV)The ratio of a mortgage loan amount to the appraised value or purchase price of a property, expressed as a percentage.
SteeringAn illegal practice where a real estate agent directs buyers toward or away from certain neighborhoods based on the buyer's race, religion, national origin, or other protected characteristics.
Math Concepts
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