|HOLC Map of Chicago 1939 (Source)|
|View of North Lawndale (Source)|
A particular idiosyncrasy of the effects of redlining, and one that conspired to unnerve white’s acceptance of the arrival of blacks into their neighborhoods, was that white homeowners also experienced great difficulty in obtaining credit in neighborhoods that had been redlined. Whether whites were seeking a mortgage for purchasing a home or financing costly home repairs in a redlined neighborhood, if FHA would not insure mortgages in that geographical area banks would likely not provide them. 2
The situation was certainly not monolithic though. When white real estate speculators started their dealings in transitioning neighborhoods, they had easier access to various sources of financing that eluded blacks. That access to financing provided speculators with the cash flow to go in and buy from white homeowners before turning and re-selling those same properties on contract to blacks at a greatly increased price.3
Emergence of Exploitative Contract Selling, Part 1: An Introduction
Emergence of Exploitative Contract Selling, Part 2: Restrictive Covenants and Real Estate Boards
Emergence of Exploitative Contract Selling, Part 4: The Fair Housing Act of 1968 and the Community Reinvestment Act of 1977
1 McPherson, “‘In My Father’s House There Are Many Mansions—and I’m Going to Get Me Some of Them Too’: The Story of the Contract Buyers League.” The Atlantic Monthly Apr. 1972: 54.
2 Satter, “Family Properties” 45.
3 McKnight. (Nov 7, 2012). personal interview.