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Redlining
       
 
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Redlining

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Redlining
A practice in which certain areas of a community are eliminated from eligibility for mortgages or other loans, either intentionally or unintentionally, allegedly because the area is considered a poor investment Risk.
    
The unethical practice whereby financial institutions make it extremely difficult or impossible for residents of poor inner-city neighborhoods to borrow money, gain approval for a mortgage, take out insurance or gain access to other financial services because of High Default rates. In this case, the rejection does not take the individual's qualifications and creditworthiness into account.
    
In some cases of redlining, financial institutions would literally draw a red line on a map around the neighborhoods in which they did not want to Offer financial services, giving the term its name.
    
Although the Federal Community Reinvestment act was passed in 1977 to put an end to all redlining practices, critics say the discrimination still occurs.
Posted by  Privatebanking.com
 
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