Mark Edward Alston is owner of Skyway Realty and Alston & Associates, a community-based, full-service mortgage company. As a broker himself, Mr. Alston has more than 30 years of experience in the industry and has presented home-buying informative lectures across the country for more than 20 years. He is also known to advocate for policies and laws that help rebuild local communities by empowering consumers to acquire and maintain property ownership.
Mr. Alston is the current Chairman of the National Association of Real Estate Brokers (NAREB) Political Action Committee as well as the 1st Vice President of the California Association of Real Estate Brokers. Mr. Alston has served as President of the Consolidated Board of Realtist of Los Angeles as well as Chairman of NAREB’s Mortgage Banking Committee and President of its Los Angeles chapter.
1. How did the National Association of Real Estate Brokers (NAREB) come about and how did “Realtist” became the professional designation of your members?
The National Association of Real Estate Brokers was birthed out of need and desire. The climate in the country was one of exclusion with regard to Black housing, Black home ownership and Black professional affiliation. The National Association of Realtors (NAR) did not accept Blacks as members. There was little or no housing available for Black veterans returning from World War II. The practice of redlining and private covenants which banned Black occupants was wide spread throughout the country. In this environment, 12 Black real estate brokers met in Tampa Florida in the summer of 1947 and formed the National Association of Real Estate Brokers (NAREB) and set the motto ” Democracy in Housing” as both a motto and mission statement.
The term “Realtist” was chosen to define membership in NAREB. Realtist is an action word. Real property practitioners with a real mission to improve life for both Black consumers and Black professionals.
2. After the Great Recession of 2006-2013 does your research and data suggest that aspiring homeowners have the same passion for homeownership as in previous decades?
The Great Recession of 2007-2013 has left a devastating impact in the Black community. The most recent Home Mortgage Disclosure Act data (HMDA) shows in the top ten mortgages lenders, Black applicant approval rate is as low as 29% and Black applicant denial rates are as high as 58%. There were 983,538 Black borrower applications that resulted in only 293,445 new mortgages. 690,093 Black applicants were not approved either by denial or fall out.
When the success ratio is this low, it affects the consciousness of the community. Stories of denial run from friend to family and we stop trying rather than take a chance at failure. To answer the question: “do aspiring homeowners have the same passion as in previous decades?”, the answer is a resounding “yes.” The passion has been hidden by a blanket of disappointment and negative results, but lays in wait for better times and opportunity.
3. The Black homeownership rate has fallen to its lowest level since the Civil Rights Act of 1964. What do you feel are the keys to reversing this trend?
The key to reversing the trend of low Black home ownership rates would be a return to policies that encourage home ownership and eliminate disparities that tend to have racially affected impact. The use of old, out dated credit models, the reluctance to include new and more inclusive alternate credit platforms that are more representative of the communities we serve, the elimination of disparate policies such as Loan Level Price Adjustments (LLPA’s) which when initiated in 2008, at a time when both Fannie Mae and Freddie Mac were in danger of failing, have served their purpose and now serve to overcharge lesser qualified borrowers and reward higher qualified borrowers. This stands in the face of their original mission statements to provide mortgage liquidity, stability and affordability.
In 1938 when Fannie Mae was created as part of President Roosevelt’s “New Deal”, White home ownership was at what was considered disastrous 50%, Black home ownership has never reached 50%, the high point being 49.6% in 2004. In a country where the average Black family earns $60.01 to ever $100.00 earned by White families, the average White net worth is 10 times that of the average Black family, housing finance policy designed to charge approved borrowers more based of lower down payments and lower but approvable credit scores is a racially disparate policy – whether it was intended to be or not, and retards home financing opportunity.
4. What changes should the mortgage industry including, FHA, Fannie Mae and Freddie Mac, prioritize over the next 12 months?
FHA should address the monthly mortgage insurance fee charge – the congressionally mandated 2% reserve requirement. According to FHA’s November 15, 2019 report, the current reserve is 4.84%. FHA should immediately reduce its monthly fee which, in turn, would increase affordability.
Fannie Mae and Freddie Mac should eliminate collecting loan level price adjustments in both mortgage and private mortgage insurance applications which would help to level the playing field in home finance opportunity.
5. Is mortgage lending keeping up with the demand in urban markets of America?
Mortgage lending is not keeping up with the demand of the urban market in America. There is a shortage of loan officers and mortgage providers who look like the communities they work in. The apathy of disconnected lending professionals is represented in the high fall out and low approval numbers. Major bank and lenders need to reopen broker channels to reach qualified but reluctant would-be borrowers.
