What is redlining?

Redlining refers specifically to the practice whereby lenders refuse to offer financial services, such as loans or mortgages, to residents in certain areas largely based on the demographic characteristics of those living in those areas. This discriminatory practice often targets neighborhoods predominantly inhabited by racial or ethnic minorities, effectively denying them the same access to financial resources as those in more affluent or predominantly white neighborhoods.

This practice has had wide-reaching implications on housing opportunities, wealth accumulation, and overall community development, contributing to enduring patterns of segregation and economic disparity across various populations. Redlining often resulted in the creation of maps that outlined these areas in red ink, which is how the term originated.

Understanding redlining is crucial in discussions about equity, policy formation, and urban planning, as it highlights the intersection of race, class, and access to essential financial services in housing.