NAACP'S DISCRIMINATION LAWSUIT AGAINST LENDERS GROWS

The National Association for the Advancement of Colored People (NAACP) on Tuesday filed a lawsuit against seven more major lenders for alleged racial discriminatory lending practices.

The NAACP named Countrywide, CitiMortgage, Suntrust Mortgage, GMAC Rescap, JP Morgan, National City and First Horizon as new defendants in its class-action racial discrimination lawsuit, filed last July in U.S. District Court in downtown Los Angeles.

Calling President George W. Bush's mortgage bailout "too little too late," the NAACP said Bush's recent plan to freeze introductory mortgage rates for five years won't help the majority of African Americans victimized by discriminatory lending practices.

Brian Kabateck, an attorney representing the NAACP in its lawsuit, said Bush's plan ignores those already wounded by the subprime mortgage crisis.

"It's a case of too little too late," Kabateck said in a statement. "For those hurt the most by predatory lending, the proposal is useless."

Angela Ciccolo, interim general counsel for the NAACP, called Bush's plan "mere window dressing, allowing lenders to continue to engage in racially discriminatory practices with little government oversight."

The lawsuit claims that major mortgage lenders intentionally discriminated against African American borrowers trying to buy homes.


• A July 2007 report by Freddie Mac -- the Federal Home Loan Mortgage Corp. -- said minority borrowers pay higher annual percentage rates on their mortgages than non-minorities with equal income and credit risk, the NAACP said.

• When subprime loans are factored in, the differences are even more dramatic, the NAACP said. In 2005, African American borrowers paid an average of 128 basis points more for loans than white, while in the subprime market that difference ballooned to 403 points, the NAACP said.

• From 2004 to 2006, African Americans were 31 to 34 percent more likely to be put into a high-cost subprime loan than white borrowers in similar situations, according to data collected under the Home Mortgage Disclosure Act.