Fintech Struggles To Make Digital Mortgages Colorblind
Financial technology has led the way in groundbreaking advancements for the mortgage and digital mortgage world. However, it looks like it has reached a stall when it comes to making digital mortgages colorblind.
"When banks and fintechs offer mortgages online using automated underwriting, they charge creditworthy minorities more than white applicants — the same way human loan officers do," according to National Mortgage News.
"That's the conclusion of a study conducted by professors at the University of California, Berkeley."
The team found that the algorithms used to make decisions that officers would usually make, may not be capable of making unbiased decisions. According to the report, it is also a critical to track whether these algorithms could "potentially introduce new and unintended forms of discrimination."
Unfortunately, findings show that minorities who have credit factors that are equivalent and sufficient, are being charged more for mortgages both at the digital mortgage level and in person.
To learn more about the study and where digital mortgages are still struggling, click on the image above.
