The City of Philadelphia strives to ensure that its authorized depositories provide financial products and services in a fair and unbiased manner to the residents of Philadelphia in accordance with City Council Resolution No. 051161. Since 2006, the City’s Treasurer’s Office has commissioned ESI alongside MFR Consultants to complete an annual Fair Lending Analysis.
Each year the research team examines Philadelphia’s authorized depositories’ residential mortgage lending practices, prime and subprime home lending, home lending to non-owner-occupied borrowers, depositories and home lending, small business lending, and how the City compares to other areas. In other words, does the data indicate practices of racial or ethnic discrimination by lenders and/or by City depositories? ESI then considers denial rates by loan type, and less-favorable lending terms (e.g., subprime versus prime loans).
With each study, ESI has provided the City of Philadelphia with the tools and information needed to provide oversight and accountability around fair lending. ESI highlights the loan types and groups that are more likely to be discriminated against, in addition to identifying if any depositories are engaging in unfair lending practices. These findings are then compared to the findings from prior years to determine if the discriminatory lending practices are improving or worsening in Philadelphia.
The rankings and broader analysis provides the City’s Treasurer’s Office with the additional context needed to engage with Philadelphia’s Authorized Depositories as they consider efforts and initiatives to improve their lending practices in the city.
