Graduates of historically black colleges may be paying more for loans according to a watchdog group. John Iadarola and Jayar Jackson break it down on The Damage Report. Follow The Damage Report on Facebook: https://www.facebook.com/TheDamageReportTYT/
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Read more here: https://www.npr.org/2020/02/05/802904167/watchdog-group-minority-college-graduates-may-pay-higher-interest-rates
"Financial firms may be discriminating against people based on where they went to college, a watchdog group says. In particular, the group found that a lender named Upstart appears to be charging higher interest rates on student loans to graduates of historically black or predominantly Hispanic colleges.
A lot more people are getting loans these days from a new breed of lenders known as fintechs, or financial technology firms. And some of these lenders factor in where loan applicants went to college.
"It really raised some alarm flags," said Kat Welbeck, the civil rights counsel at the nonprofit Student Borrower Protection Center.
So her group decided to run a test. It chose a lender called Upstart, in part because it’s a fairly prominent fintech that says it considers educational data. And the group was able to easily apply and get loan offers on its website.
The group applied for dozens of loans online — posing as a 24-year-old man. It said he lives in New York, works as a financial analyst and makes $50,000 a year. Each time the group applied for a loan, it kept a whole range of factors constant."
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