Redlining

Redlining is a discriminatory practice in which financial and other services are denied or restricted to residents in certain neighborhoods, typically on the basis of race, ethnicity, or national origin. The term originates from the color-coded maps used by the Home Owners' Loan Corporation (HOLC) in the United States during the 1930s, which graded neighborhoods from best (green) to worst (red) for mortgage lending. Redlined areas were often occupied by minority communities and received limited access to home loans, refinancing, or insurance, regardless of individual creditworthiness.

Although HOLC maps played a prominent role, redlining also reflected and reinforced broader policies and private lending practices. Lenders and, at times, government programs avoided or discouraged investment in redlined neighborhoods, contributing to disinvestment and the entrenchment of segregation.

The impact of redlining has been profound and long-lasting. It reduced home equity, lowered property values, and diminished tax revenue and public services in affected areas, helping to perpetuate wealth gaps, weakened schools, and fragmented communities. The practice contributed to persistent racial and spatial segregation that shaped urban development for decades.

Legal responses emerged through the Civil Rights Movement and subsequent legislation. The Fair Housing Act of 1968 prohibited discrimination in housing sales and financing, and the Community Reinvestment Act of 1977 encouraged banks to meet the credit needs of all communities, with enforcement by federal regulators.

Today, redlining as an explicit policy is unlawful, but its legacy persists in geographic disparities and ongoing concerns about discriminatory underwriting, data bias, and unequal access to credit.