S-0120.5                   _______________________________________________

                                                     SENATE BILL 5432

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State of Washington                              53rd Legislature                             1993 Regular Session

By Senators Pelz, Prentice, Moore, Franklin, Bauer, Wojahn, Fraser and Skratek

Read first time 01/27/93.  Referred to Committee on Labor & Commerce.

Studying discrimination based on race and national origin in home mortgage lending.

          AN ACT Relating to a study of discrimination based on race and national origin in mortgage lending; and creating new sections.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION. Sec. 1.  The federal home mortgage disclosure act has recently required depository institutions to analyze and make available first-time loan and rejection rates by race, national origin, and income, among other factors.  According to these data, some depository institutions operating in Washington state have rejected a disproportionate number of mortgage applications from minorities, even when income is taken into account.  With this study, the legislature intends to support the lending institutions in their attempts to remedy this problem.

NEW SECTION. Sec. 2.  The department of general administration shall perform a study of the problem of discrimination based on race and national origin in home mortgage lending after 1990.  The study must address the nature of the problem and why it is occurring, what depository institutions around the country and in this state are doing to solve the problem, and suggest what depository institutions operating in this state could do to solve the problem.  The department of general administration shall report the results of the study to the committees on financial institutions and insurance of the house of representatives and the committee on labor and commerce of the senate by December 1, 1993.  For purposes of this section, the term "depository institution" means a commercial bank, savings bank, savings and loan association, building and loan association, homestead association including cooperative banks, or credit union that makes federally related mortgage loans as determined by the federal reserve board, mortgage banking subsidiary of a bank holding company or savings and loan holding company, or savings and loan service corporation that originates or purchases loans.

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