1930's Redlining

What Was Redlining?

Redlining was a discriminatory practice where banks and the federal government systematically denied mortgages, loans, and insurance to people living in certain neighborhoods, often based on race or ethnicity. These areas were literally outlined in red on maps, giving the practice its name.

Who Was Affected?

Redlining primarily targeted Black, Mexican-American, and other minority communities. Cities such as Houston, Dallas, San Antonio, and El Paso had neighborhoods labeled “hazardous,” making it nearly impossible for residents to secure home loans or invest in their properties. Even families with steady incomes were blocked from homeownership.

The Government’s Role

The Home Owners’ Loan Corporation (HOLC), a federal agency, created maps in the mid-1930s to guide banks on mortgage lending. Neighborhoods with Black or Mexican-American residents were typically rated “C” or “D” (high risk), while white neighborhoods received “A” or “B” ratings and easy access to loans. These maps weren’t just suggestions, they shaped decades of housing inequality.

Long-Term Effects

Redlining had lasting consequences:

• Families in redlined areas were denied the chance to build wealth through homeownership.

• Property values stayed low.

• Schools were underfunded, and businesses struggled.

• White families in “green” neighborhoods accumulated generational wealth.
  
  

Even today, some neighborhoods still reflect these historic policies through income disparities, segregation, and unequal access to resources.